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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
20549

FORM 10-K

(Mark One)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended June 30, 2011

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____to _____

COMMISSION FILE NUMBER:000-33189

CANYON COPPER CORP.(Exact
name of registrant as specified in its charter)

|NEVADA                                                               | 88-0452792                          
|-------------------------------------------------------------------- | ------------------------------------
|(State or other jurisdiction of incorporation or
      organization) | (I.R.S. Employer Identification No.)
|                                                                     |                                     
|Suite 408 - 1199 West Pender Street                                  |                                     
|Vancouver, BC, Canada                                                | V6E 2R1                             
|(Address of principal executive offices)                             | (Zip Code)                          

Registrants telephone number, including area code (604)
331-9326

Securities registered under Section 12(b) of the Exchange Act:
NONE.

Securities registered under Section 12(g) of the Exchange Act:
Common Stock, $0.00001 Par Value per Share

Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined by Rule 405 of the Securities Act. 
Yes [ ] No
[X]

Indicate by check mark if the registrant is not required to file
reports pursuant to Section 13 or Section 15(d) of the Act. 
Yes [ ] No
[X]

Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X]No [ ]

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (s. 229.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files).
  
Yes [ ] No [ ]

Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K (s229.405 of this chapter) is not
contained herein, and will not be contained, to the best of registrants
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this Form 10-K. [
]

Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company. See the definitions of large accelerated filer,
accelerated filer and smaller reporting company in Rule 12b-2 of the
Exchange Act.

|Large accelerated filer [ ]                                                   | Accelerated filer [ ]          
|----------------------------------------------------------------------------- | -------------------------------
|Non-accelerated filer [ ] (Do not check if a smaller
      reporting company) | Smaller reporting company [ X ]

Indicate by check mark whether the registrant is a shell company
(as defined in Rule 12b-2 of the Act). Yes [ ] No [X]

State the aggregate market value of the voting and non-voting
common equity held by non-affiliates computed by reference to the price at which
the common equity was sold, or the average bid and asked price of such common
equity, as of the last business day of the registrants most recently completed
second fiscal quarter. $18,641,034, based on a closing price of $0.32 of the
issuers common stock on December 31, 2010.

State the number of shares outstanding of each of the issuers
classes of common equity, as of the latest practicable
date:68,396,934, as at September 26, 2011.

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|CANYON COPPER CORP.             
|--------------------------------
|ANNUAL REPORT ON FORM 10-K      
|FOR THE YEAR ENDED JUNE 30, 2011
|                                
|                                
|TABLE OF CONTENTS               

|                |                                                                                                                          | PAGE
|--------------- | ------------------------------------------------------------------------------------------------------------------------ | ----
|                |                                                                                                                          |     
|PART
      I    |                                                                                                                          | 4   
|                |                                                                                                                          |     
|ITEM
      1.   | BUSINESS                                                                                                                 | 4   
|ITEM
      1A.  | RISK
      FACTORS                                                                                                       | 7   
|ITEM
      2.   | PROPERTIES                                                                                                               | 12  
|ITEM
      3.   | LEGAL
      PROCEEDINGS                                                                                                  | 20  
|                |                                                                                                                          |     
|PART
      II   |                                                                                                                          | 21  
|                |                                                                                                                          |     
|ITEM
      5.   | MARKET
      FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
      PURCHASES OF EQUITY SECURITIES | 21  
|ITEM
      7.   | MANAGEMENT'S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS                              | 22  
|ITEM
      8.   | FINANCIAL
      STATEMENTS AND SUPPLEMENTARY DATA                                                                        | 26  
|ITEM
      9.   | CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
      DISCLOSURE                         | 27  
|ITEM
      9AT. | CONTROLS
      AND PROCEDURES                                                                                            | 27  
|ITEM
      9B.  | OTHER
      INFORMATION                                                                                                  | 29  
|                |                                                                                                                          |     
|PART
      III  |                                                                                                                          | 30  
|                |                                                                                                                          |     
|ITEM
      10.  | DIRECTORS,
      EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE                                                             | 30  
|ITEM
      11.  | EXECUTIVE
      COMPENSATION                                                                                             | 33  
|ITEM
      12.  | SECURITY
      OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
      STOCKHOLDER MATTERS               | 34  
|ITEM
      13.  | CERTAIN
      RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE                                          | 36  
|ITEM
      14.  | PRINCIPAL
      ACCOUNTING FEES AND SERVICES                                                                             | 39  
|ITEM
      15.  | EXHIBITS,
      FINANCIAL STATEMENT SCHEDULES                                                                            | 40  
|                |                                                                                                                          |     
|SIGNATURES      | 42                                                                                                                      

2

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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS

Certain statements contained in this Annual Report
constitute "forward-looking statements. These statements, identified by words
such as plan, "anticipate, "believe, "estimate, "should, "expect" and
similar expressions include our expectations and objectives regarding our future
financial position, operating results and business strategy. Forward-looking
statements involve known and unknown risks, uncertainties, assumptions and other
factors that may cause the actual results, performance or achievements of the
Company to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. Such
factors include, among others, general business, economic, competitive,
political and social uncertainties; the actual results of current exploration
activities; actual results of reclamation activities; conclusions of economic
evaluations; changes in project parameters as plans continue to be refined;
changes in labour costs or other costs of production; future mineral prices;
equipment or processes to operate as anticipated; accidents, labour disputes and
other risks of the mining industry, including but not limited to environmental
hazards, cave-ins, pit-wall failures, flooding, rock bursts and other acts of
God or unfavourable operating conditions and losses; political instability,
insurrection or war; delays in obtaining governmental approvals or financing or
in the completion of development or construction activities, as well as those
factors discussed in the section titled "Item 1A. Risk Factors" in this Annual
Report.

Forward looking statement are based on a number of material
factors and assumptions, including the results of exploration and drilling
activities, the availability and final receipt of required approvals, licenses
and permits, that sufficient working capital is available to complete proposed
exploration and drilling activities, that contracted parties provide goods
and/or services on the agreed time frames, the equipment necessary for
exploration is available as scheduled and does not incur unforeseen break downs,
that no labour shortages or delays are incurred and that no unusual geological
or technical problems occur. While the Company considers these assumptions may
be reasonable based on information currently available to it, they may prove to
be incorrect. Actual results may vary from such forward-looking information for
a variety of reasons, including but not limited to risks and uncertainties
disclosed in the section titled Item 1A. Risk Factors in this Annual
Report.

We intend to discuss in its quarterly and annual reports any
events or circumstances that occurred during the period to which such documents
relate that are reasonably likely to cause actual events or circumstances to
differ materially from those disclosed in this Annual Report. New factors emerge
from time to time, and it is not possible for management to predict all of such
factors and to assess in advance the impact of each such factor on our business
or the extent to which any factor, or combination of such factors, may cause
actual results to differ materially from those contained in any forwarding
looking statement.

We advise you to carefully review the reports and documents
we file from time to time with the United States Securities and Exchange
Commission (the SEC), particularly its periodic reports filed with the SEC
pursuant to the Securities Exchange Act of 1934 (the "Exchange Act").

As used in this Annual Report, the terms we, us, our,
Canyon Copper, and the Company refer to Canyon Copper Corp., unless
otherwise indicated. All dollar amounts in this Annual Report are expressed in
U.S. dollars, unless otherwise indicated.

3

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PART I

|ITEM 1. | BUSINESS.
|------- | ---------

OVERVIEW

We were incorporated on January 21, 2000 under the laws of the
State of Nevada.

We are an exploration stage company engaged in the acquisition,
exploration and development of mineral properties. We currently hold 100% title
in a major claim block totalling 1,293 unpatented mineral claims, covering
approximately 25,860 acres located in Mineral County, Nevada (the New York
Canyon Claims). We also hold 21 patented mineral claims covering an area of
approximately 420 acres, located within the vicinity of the New York Canyon
Claims area. We collectively refer to the New York Canyon Claims and the
patented claims as the New York Canyon Project. See Item 2. Properties.

We have not earned any revenues to date and do not anticipate
earning revenues until such time as we enter into commercial production of our
mineral properties. We are presently in the exploration stage of our business
and we can provide no assurance that commercially viable mineral deposits exist
on our claims or that we will discover commercially exploitable levels of
mineral resources on our properties, or if such deposits are discovered, that we
will enter into further substantial exploration programs.

RECENT CORPORATE DEVELOPMENTS

Since the filing of our Quarterly Report for the fiscal quarter
ended March 31, 2011 with the SEC on May 10, 2011, we experienced the following
significant corporate developments:

|1. | We completed our non-brokered private placement offering
      (the "Non-Brokered Offering") as follows:
|-- | --------------------------------------------------------------------------------------------------------
|   |                                                                                                         
|   | (a)                                                                                                     
|   |                                                                                                         
|   | (b)                                                                                                     
|   |                                                                                                         
|   | (c)                                                                                                     
|   |                                                                                                         
|   | (d)                                                                                                     

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|2. | On July 13, 2011, we completed our brokered private
      placement offering (the Brokered Private Placement) by issuing 2,164,071
      units at a price of CDN $0.35 per unit for gross proceeds of CDN
      $757,424.85 (USD $785,449.57). Each unit consisted of one share of common
      stock and one-half of one non-transferable Warrant. Each whole Warrant
      entitles the holder to purchase one additional share of common stock at a
      price of CDN $0.50 per share until January 13, 2013. The issuance was
      completed pursuant to the provisions of Regulation S of the Securities
      Act. MGI Securities Inc. (MGI) acted as lead agent for the brokered
      private placement. In connection with the offering, we paid MGI a cash
      commission of CDN $45,445.49 (USD $47,126.97) and issued MGI, and its sub
      agents, an option to purchase 129,844 units at a price of CDN $0.35 per
      unit until January 13, 2013 (the Agents Option). On exercise of the
      Agents Option, each unit will consist of one share of our common stock
      and one-half of one non-transferable Warrant (the Agents Warrants).
      Each whole Agents Warrant will entitle the holder to purchase one
      additional share of common stock at a price of CDN $0.50 per share until
      January 13, 2013. The issuance of the Agents Option was completed
      pursuant to Regulation S of the Securities Act.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|3. | Our shares of common stock commenced trading on the TSX
      Venture Exchange on July 18, 2011 under the symbol CNC. We are
      classified as a Tier 1 Mining Issuer on the TSX Venture
  Exchange.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

Products, Markets, Distribution, Suppliers, and
Customers

We do not currently produce any products, metals, or minerals
nor do we offer any products for sale. We are not party to any distribution
arrangements, and have no principal customers or suppliers. We do not anticipate
any changes in this status for at least the next 12 months, or until such time
as there is a commercially viable mineral or metal deposits located on our
mineral property.

Competition

We are an exploration stage company. We compete with other
mineral resource exploration and development companies for financing and for the
acquisition of new mineral properties. Many of the mineral resource exploration
and development companies with whom we compete have greater financial and
technical resources than us. Accordingly, these competitors may be able to spend
greater amounts on acquisitions of mineral properties of merit, on exploration
of their mineral properties and on development of their mineral properties. In
addition, they may be able to afford greater geological expertise in the
targeting and exploration of mineral properties. This competition could result
in competitors having mineral properties of greater quality and interest to
prospective investors who may finance additional exploration and development.
This competition could adversely impact on our ability to finance further
exploration and to achieve the financing necessary for us to develop our mineral
properties.

Markets and Economics

Although we compete with other junior exploration companies for
financing, properties of merit, and subcontractors, there is no competition for
the exploration or removal of mineralized material from the New York Canyon
Project. Although there can be no assurance, large and well capitalized markets
are readily available for all metals and precious metals throughout the world. A
very sophisticated futures market for the pricing and delivery of future
production also exists. At present there are no limitations with respect to the
sale of metals or precious metals other than price. The price for metals is
affected by a number of global factors, including economic strength and
resultant demand for metals for production, fluctuating supplies, mining
activities and production by others in the industry, and new and or reduced uses
for subject metals.

Description of Mining Industry

The mining industry is highly speculative and of a very high
risk nature. As such, mining activities involve a high degree of risk, which
even a combination of experience, knowledge and careful evaluation may not be
able to overcome. Few mining projects actually become operating mines.

The mining industry is subject to a number of factors,
including intense industry competition, high susceptibility to economic
conditions (such as price of metal, foreign currency exchange rates, and capital
and operating costs), and political conditions (which could affect such things
as import and export regulations, foreign ownership restrictions). Furthermore,
the mining activities are subject to all hazards incidental to mineral
exploration, development and production, as well as risk of damage from
earthquakes, any of which could result in work stoppages, damage to or loss of
property and equipment and possible environmental damage. Hazards such as
unusual or unexpected geological formations and other conditions are also
involved in mineral exploration and development.

5

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Governmental Controls and Approvals

Exploration and development activities are all subject to
stringent national, state and local regulations. All permits for exploration and
testing must be obtained through the local Bureau of Land Management (BLM)
offices of the Department of Interior in the State of Nevada. The granting of
permits requires detailed applications and filing of a bond to cover the
reclamation of areas of exploration. From time to time, an archaeological
clearance may need to be obtained prior to proceeding with any exploration
programs.

We plan to secure all necessary permits for any future
exploration. We must provide for all environmental concerns and ensure no
discharge of water into any body of water regulated by environmental law or
regulation. Indigenous and endangered species must only be subject to very
minimal or nil disturbances. Restoration of the disturbed land will be completed
according to applicable regulations and laws. All holes, pits and shafts will be
sealed upon abandonment of the property. It is difficult to estimate the cost of
compliance with the environmental laws since the full nature and extent of our
proposed activities cannot be determined until we start our operations.

We have applied for and received permits from the BLM to
conduct drilling activities on BLM administered lands within the New York Canyon
Project. The BLM reference the property as case file NV N-79198. We are required
to adhere to the stipulations of the permit, primarily to plug all drill holes
as they are completed and to reclaim roads and drill sites when they are no
longer necessary. Reclamation work is ongoing but not complete as the project
remains active.

Our mining operation is regulated by Mine and Safety Health
Administration (MSHA). MSHA inspectors periodically visit our project to
monitor health and safety for the workers, and to inspect equipment and
installations for code requirements. All of our workers have completed MSHA
safety training and must take refresher courses annually when working on our
project. A safety officer for the project is also on site.

Other regulatory requirements monitor the following:

| | (a) | Explosives and explosives handling.                                   
| | --- | ----------------------------------------------------------------------
| | (b) | Use and occupancy of site structures associated with
      mining.    
| | (c) | Hazardous materials and waste disposal.                               
| | (d) | State Historic site preservation.                                     
| | (e) | Archaeological and paleontological finds associated with
      mining.

We believe that we are in compliance with all laws and plans to
continue to comply with the laws in the future. We believe that compliance with
the laws will not adversely affect its business operations. There is however no
assurance that any change in government regulation in the future will not
adversely affect our business operations.

Federal Claim Maintenance Fees

In order to maintain our New York Canyon Project claims each
year we must pay a maintenance fee of $140 per claim to the Nevada State Office
of the Bureau of Land Management and on November 1 of each year we must file an
affidavit and Notice of Intent to Hold the claims in Mineral County. We have
paid the required maintenance fees and filed the affidavits required in order to
extend the claims to August 31, 2012.

Environmental Liability

The New York Canyon Project property has a history of
exploration and development dating back to the early 1900s. As such there are a
series of prospect pits, exploration and mine shafts, road cuts and general
mining debris scattered throughout the property. None of this is considered to
be an environmental hazard; however, open mine workings are required to be
fenced for public safety. Operators during the bulk of the exploration of the
property during the 1960s through 1990s conducted their activities in
compliance with BLM requirements.

6

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This work has been either reclaimed or accepted by the BLM. We
are not responsible for existing disturbance from prior activities on the New
York Canyon Project.

Patents and Trademarks

We do not own, either legally or beneficially, any patents or
trademarks.

Research and Development Activities And Costs

We have no plans to undertake any research and development
activities in the foreseeable future, and have not incurred research and
development expenditures to date.

Employees

Aside from our officers and directors, we have no employees at
present.

|ITEM 1A. | RISK FACTORS.
|-------- | -------------

The following are some of the important factors that could
affect our financial performance or could cause actual results to differ
materially from estimates contained in our forward-looking statements. We may
encounter risks in addition to those described below. Additional risks and
uncertainties not currently known to us, or that we currently deem to be
immaterial, may also impair or adversely affect our business, financial
condition or results of operation.

An investment in our common stock involves a high degree of
risk. You should carefully consider the risks described below and the other
information in this Annual Report before investing in our common stock. If any
of the following risks occur, our business, operating results and financial
condition could be seriously harmed. The quotation price of our common stock, if
we obtain a public quotation at a later date, could decline due to any of these
risks, and you may lose all or part of your investment.

We lack an operating history and have losses which we expect
to continue into the future. As a result, we may have to suspend or cease
exploration activities and if we do not obtain sufficient financing, our
business will fail.

We were incorporated on January 21, 2000 and to date have been
involved primarily in the acquisition of our mineral property and the
exploration and development on this property. We have no exploration history
upon which an evaluation of our future success or failure can be made. Our
ability to achieve and maintain profitability and positive cash flow is
dependent upon:

- our ability to locate a profitable mineral property; and
- our ability to generate revenues.

Our plan of operation calls for significant expenses in
connection with the exploration of the New York Canyon Project, which may
require us to obtain financing. We recorded a net loss of $852,281 for the year
ended June 30, 2011 and have an accumulated deficit of $21,837,768 since
inception. As at June 30, 2011, we had cash of $1,226,964. Subsequent to June
30, 2011, we raised gross proceeds of CDN $1,057,425 (USD $1,096,549.73) from
the sale of our securities. For the next twelve months, management anticipates
that the minimum cash requirements to fund our proposed exploration program and
our continued operations will be $1,090,000. Accordingly, we have sufficient
funds to meet our planned expenditures over the next twelve months. In the event
that we decide to proceed with phase two of our exploration program, of which
there is no assurance, we will be required to raise additional financing.

Obtaining financing would be subject to a number of factors,
including the market prices for the mineral property and base and precious
metals. These factors may make the timing, amount, terms or conditions of
additional financing unavailable to us. Since our inception, we have used our
common stock to raise money for our operations and for our property
acquisitions. We have not attained profitable operations and are dependent upon
obtaining financing to pursue our plan of operation.

7

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Because we anticipate our operating expenses will increase
prior to our earning revenues, we may never achieve profitability.

Prior to completion of our exploration stage, we anticipate
that we will incur increased operating expenses without realizing any revenues.
We therefore expect to incur significant losses into the foreseeable future. We
recognize that if we are unable to generate significant revenues from the
exploration of our mineral claims and the production of minerals thereon, if
any, we will not be able to earn profits or continue operations. There is no
history upon which to base any assumption as to the likelihood that we will
prove successful, and we may not be able to ever generate any operating revenues
or achieve profitable operations. If we are unsuccessful in addressing these
risks, our business will most likely fail.

Because we are an exploration stage company, our business
has a high risk of failure.

As noted in the financial statements that are included with
this Annual Report, we are an exploration stage company that has incurred net
losses since inception, we have not attained profitable operations and we are
dependent upon obtaining adequate financing to complete our exploration
activities. These conditions, as indicated in our audit report included in this
Annual Report for the year ended June 30, 2011, raise substantial doubt as to
our ability to continue as a going concern. The success of our business
operations will depend upon our ability to obtain further financing to complete
our planned exploration program and to attain profitable operations. If we are
not able to complete a successful exploration program and attain sustainable
profitable operations, then our business will fail.

Because we have not commenced business operations, we face a
high risk of business failure.

We have not earned any revenues as of the date of this Annual
Report. Potential investors should be aware of the difficulties normally
encountered by new mineral exploration companies and the high rate of failure of
such enterprises. The likelihood of success must be considered in light of the
problems, expenses, difficulties, complications and delays encountered in
connection with the exploration of the mineral properties that we plan to
undertake. These potential problems include, but are not limited to,
unanticipated problems relating to exploration, and additional costs and
expenses that may exceed current estimates.

We have no known mineral reserves and if we cannot find any,
we will have to cease operations.

We have no mineral reserves. Mineral exploration is highly
speculative. It involves many risks and is often non-productive. Even if we are
able to find mineral reserves on our property our production capability is
subject to further risks including:

- Costs of bringing the property into production including exploration work,
  preparation of production feasibility studies, and construction of production
  facilities, all of which we have not budgeted for;
- Availability and costs of financing;
- Ongoing costs of production; and
- Environmental compliance regulations and restraints.

The marketability of any minerals acquired or discovered may be
affected by numerous factors which are beyond our control and which cannot be
accurately predicted, such as market fluctuations, the lack of milling
facilities and processing equipment near the New York Canyon Project and such
other factors as government regulations, including regulations relating to
allowable production, exporting of minerals, and environmental protection. If we
do not find a mineral reserve or define a mineral inventory containing gold,
silver or copper or if we cannot explore the mineral reserve, either because we
do not have the money to do it or because it will not be economically feasible
to do it, we will have to cease operations and investors will lose their
investment.

In order to maintain our rights to the New York Canyon
Project, we will be required to make annual filings with federal and state
regulatory agencies and/or be required to complete assessment work on the New
York Canyon Project.

In order to maintain our rights to the New York Canyon Project,
we will be required to make annual filings with federal and state regulatory
authorities. Currently the amount of these fees is approximately $195,000;
however, these maintenance fees are subject to adjustment. In addition, we may
be required by federal and/or state

8

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legislation or regulations to complete minimum annual amounts
of mineral exploration work on the New York Canyon Project. A failure by us to
meet the annual maintenance requirements under federal and state laws could
cause our rights to the New York Canyon Project to lapse.

Because of the inherent dangers involved in mineral
exploration, there is a risk that we may incur liability or damages if and when
we conduct mineral exploration activities.

The search for valuable minerals involves numerous hazards. As
a result, if and when we conduct exploration activities we may become subject to
liability for such hazards, including pollution, cave-ins and other hazards
against which we cannot insure or against which we may elect not to insure. The
payment of such liabilities may have a material adverse effect on our financial
position.

If the price of base and precious metals declines, our
financial condition and ability to obtain future financings will be
impaired.

The price of base and precious metals is affected by numerous
factors, all of which are beyond our control. Factors that tend to cause the
price of base and precious metals to decrease include the following:

| | (a) | Sales or leasing of base and precious metals by
      governments and central banks;                                                                                                                                      
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                           
| | (b) | A low rate of inflation and a strong US dollar;                                                                                                                                                                           
| |     |                                                                                                                                                                                                                           
| | (c) | Speculative trading;                                                                                                                                                                                                      
| |     |                                                                                                                                                                                                                           
| | (d) | Decreased demand for base and precious metals industrial,
      jewelry and investment uses;                                                                                                                              
| |     |                                                                                                                                                                                                                           
| | (e) | High supply of base and precious metals from production,
      disinvestment, scrap and hedging;                                                                                                                          
| |     |                                                                                                                                                                                                                           
| | (f) | Sales by base and precious metals producers and foreign
      transactions and other hedging transactions; and                                                                                                            
| |     |                                                                                                                                                                                                                           
| | (g) | Devaluing local currencies (relative to base and precious
      metals price in US dollars) leading to lower production costs and higher
      production in certain major base and precious metals producing
    regions.

Our business is dependent on the price of base and precious
metals. We have not undertaken hedging transactions in order to protect us from
a decline in the price of base and precious metals. A decline in the price of
base and precious metals may also decrease our ability to obtain future
financings to fund our planned development and exploration programs.

If we are unable to hire and retain key personnel, we may
not be able to implement our business plan.

Our success is dependent upon the performance of key personnel
working full-time in management, supervisory and administrative capacities or as
consultants. This is particularly true in highly technical businesses such as
mineral exploration. These individuals are in high demand and we may not be able
to attract the personnel we need. The loss of the services of senior management
or key personnel could have a material and adverse effect on us, our business
and results of operations. Failure to hire key personnel when needed, or on
acceptable terms, would have a significant negative effect on our business.

As we undertake exploration of our New York Canyon project,
we will be subject to compliance with government regulation that may increase
the anticipated cost of our exploration program.

There are several governmental regulations that materially
restrict mineral exploration. We are required to obtain work permits, post bonds
and perform remediation work for any physical disturbance to the land in order
to comply with these laws. If we enter the production phase, the cost of
complying with permit and regulatory environment laws will be greater because
the impact on the project area is greater. Permits and regulations will control
all aspects of the production program if the project continues to that stage.
Examples of regulatory requirements include:

| | (a) | Water discharge will have to meet drinking water
      standards;
| | --- | -----------------------------------------------------------------

9

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| | (b) | Dust generation will have to be minimal or otherwise
      re-mediated;                                                                         
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                 
| | (c) | Dumping of material on the surface will have to be
      re-contoured and re-vegetated with natural vegetation;                                 
| |     |                                                                                                                                                 
| | (d) | An assessment of all material to be left on the surface
      will need to be environmentally benign;                                           
| |     |                                                                                                                                                 
| | (e) | Ground water will have to be monitored for any potential
      contaminants;                                                                    
| |     |                                                                                                                                                 
| | (f) | The socio-economic impact of the project will have to be
      evaluated and if deemed negative, will have to be re-mediated;
  and             
| |     |                                                                                                                                                 
| | (g) | There will have to be an impact report of the work on the
      local fauna and flora including a study of potentially endangered
      species.

There is a risk that new regulations could increase our costs
of doing business and prevent us from carrying out our exploration program. We
will also have to sustain the cost of reclamation and environmental remediation
for all exploration work undertaken. Both reclamation and environmental
remediation refer to putting disturbed ground back as close to its original
state as possible. Other potential pollution or damage must be cleaned-up and
renewed along standard guidelines outlined in the usual permits. Reclamation is
the process of bringing the land back to its natural state after completion of
exploration activities. Environmental remediation refers to the physical
activity of taking steps to remediate, or remedy, any environmental damage
caused. The amount of these costs is not known at this time as we do not know
the extent of the exploration program that will be undertaken beyond completion
of the recommended work program. If remediation costs exceed our cash reserves
we may be unable to complete our exploration program and have to abandon our
operations.

If we become subject to increased environmental laws and
regulation, our operating expenses may increase.

Our development and production operations are regulated by both
US Federal and Nevada state environmental laws that relate to the protection of
air and water quality, hazardous waste management and mine reclamation. These
regulations will impose operating costs on us. If the regulatory environment for
our operations changes in a manner that increases costs of compliance and
reclamation, then our operating expenses would increase with the result that our
financial condition and operating results could be adversely affected.

There has been a very limited public trading market for our
securities, and the market for our securities may continue to be limited and be
sporadic and highly volatile.

There is currently a limited public market for our common
stock. Our common stock trades in Canada on the TSX Venture Exchange and over
the counter in the United States on the OTC Bulletin Board and OTCQB market
place. We cannot assure you that an active market for our shares will be
established or maintained in the future. The OTC Bulletin Board and OTCQB are
not national securities exchanges, and many companies have experienced limited
liquidity when traded through these quotation systems. Holders of our common
stock may, therefore, have difficulty selling their shares, should they decide
to do so. In addition, there can be no assurances that such markets will
continue or that any shares, which may be purchased, may be sold without
incurring a loss. The market price of our shares, from time to time, may not
necessarily bear any relationship to our book value, assets, past operating
results, financial condition or any other established criteria of value, and may
not be indicative of the market price for the shares in the future.

In addition, the market price of our common stock may be
volatile, which could cause the value of our common stock to decline. Securities
markets experience significant price and volume fluctuations. This market
volatility, as well as general economic conditions, could cause the market price
of our common stock to fluctuate substantially. Many factors that are beyond our
control may significantly affect the market price of our shares. These factors
include:

- price and volume fluctuations in stock markets;
- changes in our operating results;
- any increase in losses from levels expected by securities analysts;

10

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- changes in regulatory policies or law;
- operating performance of companies comparable to us; and
- general economic trends and other external factors.

Even if an active market for our common stock is established,
stockholders may have to sell their shares at prices substantially lower than
the price they paid for the shares or might otherwise receive than if an active
public market existed.

If we complete a financing through the sale of additional
shares of our common stock, shareholders will experience dilution.

The most likely source of future financing presently available
to us is through the issuance of our common stock. Any sale of share capital
will result in dilution to existing shareholders. The only other anticipated
alternative for the financing of further exploration would be the offering by us
of an interest in our properties to be earned by another party or parties
carrying out further exploration thereof, which is not presently
contemplated.

Because our stock is a penny stock, stockholders will be
more limited in their ability to sell their stock.

The SEC has adopted rules that regulate broker-dealer practices
in connection with transactions in penny stocks. Penny stocks are generally
equity securities with a price of less than $5.00, other than securities
registered on certain national securities exchanges or quoted on the Nasdaq
system, provided that current price and volume information with respect to
transactions in such securities is provided by the exchange or quotation system.

Because our securities constitute "penny stocks" within the
meaning of the rules, the rules apply to us and to our securities. The rules may
further affect the ability of owners of shares to sell our securities in any
market that might develop for them. As long as the quotation price of our common
stock is less than $5.00 per share, the common stock will be subject to Rule
15g-9 under the Securities Exchange Act of 1934 (the Exchange Act). The penny
stock rules require a broker-dealer, prior to a transaction in a penny stock, to
deliver a standardized risk disclosure document prepared by the SEC, that:

| | 1. | contains a description of the nature and level of risk in
      the market for penny stocks in both public offerings and secondary
      trading;                                                                                        
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                          
| | 2. | contains a description of the broker's or dealer's duties
      to the customer and of the rights and remedies available to the customer
      with respect to a violation to such duties or other requirements of
      securities laws;
| |    |                                                                                                                                                                                                                                          
| | 3. | contains a brief, clear, narrative description of a
      dealer market, including bid and ask prices for penny stocks and the
      significance of the spread between the bid and ask price;                                           
| |    |                                                                                                                                                                                                                                          
| | 4. | contains a toll-free telephone number for inquiries on
      disciplinary actions;                                                                                                                                                       
| |    |                                                                                                                                                                                                                                          
| | 5. | defines significant terms in the disclosure document or
      in the conduct of trading in penny stocks; and                                                                                                                             
| |    |                                                                                                                                                                                                                                          
| | 6. | contains such other information and is in such form,
      including language, type, size and format, as the SEC shall require by
      rule or regulation.                                                                              

The broker-dealer also must provide, prior to effecting any
transaction in a penny stock, the customer with: (a) bid and offer quotations
for the penny stock; (b) the compensation of the broker-dealer and its
salesperson in the transaction; (c) the number of shares to which such bid and
ask prices apply, or other comparable information relating to the depth and
liquidity of the market for such stock; and (d) a monthly account statements
showing the market value of each penny stock held in the customer's account. In
addition, the penny stock rules require that, prior to a transaction in a penny
stock not otherwise exempt from those rules, the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser's written acknowledgment of the receipt
of a risk disclosure statement, a written agreement to transactions involving
penny stocks, and a signed and dated copy of a written suitability statement.
These disclosure requirements may have the effect of reducing the trading
activity in the secondary market for our stock.

11

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|ITEM 2. | PROPERTIES.
|------- | -----------

We rent approximately 1,606 square feet of office space located
at Suite 408, 1199 West Pender Street, Vancouver, British Columbia, Canada from
ESO Uranium Corp. at a cost of approximately $1,500 per month. This rental is on
a month-to-month basis with no formal agreements.

We do not own any real property. We currently hold 100% title
in a major claim block totalling 1,293 unpatented mineral claims, covering
approximately 25,860 acres located in Mineral County, Nevada (the New York
Canyon Claims). We also hold 21 patented mineral claims covering an area of
approximately 420 acres, located within the vicinity of the New York Canyon
Claims area. We collectively refer to the New York Canyon Claims and the
patented mineral claims as the New York Canyon Project.

NEW YORK CANYON PROJECT

Description of Property

New York Canyon Claims

The 1,293 unpatented lode mining claims were physically staked
on the ground. Unpatented claims require annual maintenance fees of $140 per
claim payable to the U.S. Bureau of Land Management (BLM) by August 31 of each
year. Additionally, the county requires recording fees of approximately $15 per
claim each year. The claims are current and in good standing through August 31,
2012.

The acquisition of title to the claims was completed pursuant
to the terms of the Property Option Agreement dated March 18, 2004 (the
Property Option Agreement) among the Company and Nevada Sunrise LLC (Nevada
Sunrise), Robert Weicker, Sharon Weicker, Kurt Schendel, and Tami Schendel
(collectively, the Optionors).

Under the terms of the Property Option Agreement, we exercised
our option to acquire the New York Canyon Claims by: (i) paying $460,000 to the
Optionors; (ii) issuing 526,667 shares of our common stock to the Optionors; and
(iii) incurring exploration expenditures of a minimum of $2,250,000 on the New
York Canyon Claims. The Optionors also retained a 2% net smelter returns royalty
(the Royalty) over any future production. We have the option to reduce the
Royalty to 1% by making a lump sum payment of $1,000,000 to the Optionors.

In accordance with the terms of the Property Option Agreement
and upon our acquisition of the New York Canyon Claims, Nevada Sunrise assigned
to us its interest under two lease agreements. On October 9, 2004, Nevada
Sunrise entered into a lease agreement with Tammy Gentry and Pat Hannigan
pursuant to which it obtained a nine year lease over the Copper Queen #2
patented mineral claim. As a result of the assignment of this lease, we are
required to pay $1,500 per quarter commencing on October 1, 2004. We have the
option to acquire Copper Queen #2 by paying $50,000, of which the quarterly
payments may be applied, to the lessors. As of the date of this Annual Report,
we have paid $40,500 in lease payments which will be credited towards the total
purchase price of $50,000.

In addition, on January 1, 2005, Nevada Sunrise entered into a
lease agreement with Clifford DeGraw and Richard Markiewicz pursuant to which it
obtained a seven year lease over the Mildred and Copper Queen #1 patented
mineral claim. As a result of the assignment of these leases, we have acquired
the Mildred and Copper Queen #1 patented claims by paying an aggregate $130,000
as follows: (i) $2,500 per quarter commencing on April 1, 2005 (which payments
have been made); (ii) $3,500 per quarter commencing on April 1, 2006; (iii)
$4,000 per quarter commencing on April 1, 2007; (iv) $5,000 per quarter
commencing on April 1, 2008; and (v) $7,500 per quarter commencing on April 1,
2009. On April 1, 2011, we exercised our option to acquire the Mildred and
Copper Queen #1 patented claims by virtue of making the final lease payment to
the lessors.

Lease Agreement with Jaycor Mining Inc.

On July 21, 2004, we entered into a lease agreement (the
Jaycor Lease Agreement) with Jaycor Mining, Inc. (Jaycor). Under the terms
of the Lease Agreement, we were granted rights to explore and, if proved
feasible, develop 18 patented mineral claims held by Jaycor (the Jaycor
Claims). These rights were granted as a lease for an initial term of 15 years,
and are renewable for a further 15 years.

12

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As consideration for the lease of the Jaycor Claims, we were
required to pay Jaycor the following amounts prior to the commencement of any
future production activities: (i) $25,000 on execution of the Jaycor Lease
Agreement; (ii) $1,000 monthly commencing on the first anniversary; (iii) $2,000
monthly commencing on the second anniversary; and (iv) $3,000 monthly commencing
on the third anniversary and continuing for as long as the Jaycor Lease
Agreement is in effect (collectively, the Jaycor Minimum Payments)

In addition to the Minimum Payments, we have issued an
aggregate of 6,583 shares to Jaycor in accordance with the Jaycor Lease
Agreement. As of the date of this Annual Report, we have made all required
Minimum Payments and is in good standing under the Jaycor Lease Agreement.

The Jaycor Claims under the Lease Agreement are subject to an
overriding royalty deed granted to Kookaburra Resources Ltd. (Kookaburra) by
Jaycor. Upon commencement of production, we are required to pay Kookaburra a net
smelter returns royalty of 1.75%, up to a maximum of $2,000,000. In addition, we
have also agreed to pay Jaycor a net smelter return royalty of 0.5% until such
time as Kookaburra has been paid $2,000,000, at which time the royalty payable
to Jaycor will then increase to 1.5% . The 1.5% rate payable is subject to a
maximum of $2,000,000, at which time the ongoing royalty payment to Jaycor will
be reduced to 0.5% for as long as the Lease Agreement is in effect.

The Jaycor Claims are located in Sections 32, 33 and 34 T8N;
R35E MDBM in Mineral County, Nevada and are recorded as follows:

Name of Claim
    Mineral Survey No.
    US Patent #
    County Land ParcelMayflower
    38
    10541
    009-170-11Wall Street
    43
    21509
    009-170-09Turk
    44
    21510
    009-170-09Footwall
    3447
    264845
    009-170-03Nora Higgins
    3447
    264845
    009-170-02Willie Higgins
    3447
    264845
    009-170-02Annex No. 1
    3447
    264845
    009-170-03Annex No. 2
    3447
    264845
    009-170-03Annex No. 3
    3447
    264845
    009-170-03Annex No. 4
    3447
    264845
    009-170-03Iron Gate
    4444
    806518
    009-170-02Velvet
    4444
    806518
    009-170-02Saddle
    4444
    806518
    009-170-02Vacation
    4571
    982162
    009-170-12Goodenough
    4612
    989401
    009-170-02Copper Butte
    4612
    989401
    009-170-02Copper Bar
    4612
    989401
    009-170-02Hecla
    4612
    989401
    009-170-02


The holders of patented minerals claims generally retain all
mineral and property rights, and the permitting procedures for both exploration
and development can be streamlined and fast tracked.

13

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Figure 1  New York Canyon Property



Location and Access, Climate, Local Resources, and
Physiography

The New York Canyon Project is approximately five miles east of
Luning and 30 miles east of Hawthorne, the seat of Mineral County, in the
sparsely populated west central part of Nevada. The largest full-service city
with daily commercial air flights to most major American cities is Reno, located
169 miles north-northwest of the New York Canyon Project via paved highway US95.
Access to the New York Canyon Project from Hawthorne is via paved highway US95
for 25 miles to Luning and then by 5 miles of all-weather gravel road.

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The New York Canyon Project is at the south end of the Gabbs
Valley Range with part of the New York Canyon Project extending westward into
Soda Spring Valley. The terrain is part of the Basin and Range physiographic
province consisting of steep rugged hills at elevations from 5,500 to 7,000 feet
separated by broad basins ranging from 4,600 to 5,500 feet elevation.

The climate is semi-arid with two seasons: a wet cold winter
and a dry hot summer. The main period of snow occurs between November and March.
Annual rainfall for the last several years has ranged from 2 to 6 inches per
year with temperatures ranging from 25°F to 95°F. The prevailing vegetation
consists of grasses, low shrubs (most commonly sagebrush) and occasional patches
of pinion pine and juniper trees at higher elevations. The local economy is
based largely on ranching and mining with many people employed by the Hawthorne
Naval Ammunition Depot.

During the past twenty years, a number of mines have operated
in this part of Nevada, mostly gold and silver mines with some by-product base
metals. As a result, the community contains a small pool of experienced labor
sufficient for the needs of many short-term mining operations.

History

The New York Canyon Project has a long history of exploration,
development and production beginning with discovery of the copper oxide deposits
in 1875. The districts first recorded production occurred from 1906 to 1929
when the Wall Street Copper Company consolidated various holdings in the
district and commenced copper production at the Anderson, Champion, Mayflower,
New York, Turk, Vacation and Wall Street Mines. An estimated 8.9 million pounds
of copper was recovered from approximately 110,000 tons of ore at an average
grade of 5.5% copper during this period.

1965 to 1979 A total of 107 exploration drill
holes (98,433 feet) were drilled during 1965 to 1979 in the New York Canyon
Project area, initially by Amax but primarily by Conoco Oil Company, who
subsequently operated the Project from 1977 to 1981. Exploration was focused
mainly on porphyry copper-molybdenum sulfide targets at the Copper Queen and
Champion prospects. This historic drilling by Conoco, from 1977 to 1981,
indicated 13.2 million tons of mineralized material with an average grade of
0.55% copper for the Longshot Ridge area and 142 million tons grading 0.35% and
0.015% molybdenum for the Copper Queen deposit.

In 1979, Conoco contracted Hazen Research, Inc. to conduct a
preliminary testing program for copper recovery using sulfuric acid bottle roll
leaching tests and flotation tests on drill core sample composites. Hazen
prepared composites based on five rock types crushed to minus 0.5 inch size.
Drill core from the Copper Queen deposit yielded recoveries ranging from 65% to
75% copper over the six-day leach period with acid consumptions of 160 pounds
per ton for porphyry copper mineralized rock to 509 pounds of sulfuric acid
(H2SO4) per ton of carbonate-rich host rock. Copper oxide material provided
recoveries ranging from 75.0% to 84.45% from the six-day bottle roll test with
corresponding acid consumption of 232 to 349 pounds H2SO4 per ton of ore.

1992 to 1997 Kookaburra Resources Ltd.
(Kookaburra) and its various joint venture partners  including Coca Mines and
Phelps Dodge  conducted the next stage of exploration from 1992 to 1997,
drilling 54 holes totaling 13,018 feet to test the Longshot Ridge and Copper
Queen skarns. In 1993, Peter Cowdery, PhD., P.Eng. of CORE Engineering and
Associates conducted an estimate of the mineralized material at the Longshot
Ridge copper oxide deposit for Kookaburra Resources Ltd. The CORE technical
report indicated 17.7 million tons of mineralized material with an average grade
of 0.55% copper using a 0.23% copper cutoff.

Prior to our acquisition of the New York Canyon Project,
Kookaburra commissioned Mountain States R & D International, Inc. to conduct
a simulated vat leach test to determine copper recovery in relation to acid
consumption on minus three-quarter inch copper mineralized material from
Longshot Ridge. A 13.67 kilogram composite of typical copper oxide material was
placed into a 51⁄2 foot high column and leached with 25 gram per liter sulfuric
acid for 19 days. Results of the test indicated a 39.41% copper recovery with
total acid consumption of 174.7 pounds per ton of mineralized material.

General Geology

The New York Canyon Project lies within the central portion of
the Walker Lane structural belt, a broad zone of northwest-southeast striking
parallel to sub-parallel, right lateral strike-slip faults extending for more
than 400 miles through western Nevada and into northern California. The
structural belt was initiated during the Jurassic period, at which time a number
of important porphyry copper deposits and related skarn deposits, such as
Yerington, were formed. Volcanism and related hydrothermal mineralization, often
of Tertiary age, are recognized along the length of this structural trend.
Significant mining districts associated with the Walker Lane Belt, in addition
to Yerington, include Comstock, Goldfield, Rawhide, Tonopah-Hall, Dome Hill and
numerous other copper and/or gold-silver occurrences.

15

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The New York Canyon area stratigraphy is comprised mostly of
conformable marine sedimentary units of Triassic and Jurassic ages which are
intruded by granitic rocks of Cretaceous age. Tertiary-age non-mineralized
volcanic flows locally cover these older rocks on the hills and Quaternary-age
alluvium and colluvium cover them in the valleys. At New York Canyon, the rocks
are disrupted by structures mostly related to the Walker Lane structural belt.
These structures provide conduits for mineralizing fluids and often subsequently
disrupt mineralized zones.

The oldest rocks belong to the middle to late Triassic age
Luning Formation, consisting predominately of dolomite, dolomitic limestone and
limestone with minor shale, argillite and conglomerate. Project mapping and
logging of drill holes indicate this sequence is approximately 2000 thinner in
the Project area than its regionally mapped thickness of more than 10,000 feet.
The Luning limestones are thin to medium bedded and intercalated with siltstones
in the bottom 1000 feet of the sequence, and massive to thick bedded in the top
4000 feet of the sequence.

The late Triassic age Gabbs Formation conformably overlies the
Luning Formation. The Gabbs Formation consists of three members: a thin bedded
fossiliferous limestone, argillaceous limestone, and calcareous tuffaceous
siltstone. The type locality of the Gabbs Formation is in New York Canyon, where
its thickness is measured as 400 feet, but drill logs indicate it is up to 650
feet thick.

The Jurassic age Sunrise Formation conformably overlies the
Gabbs Formation. The Sunrise Formation consists of five members with quartz
latite porphyry flows near the base overlain by thin bedded limestones,
siltstones, silty limestone, tuffaceous siltstone, shale and claystone totaling
about 800 feet in thickness in the New York Canyon area.

The Jurassic age Dunlap Formation conformably overlies the
Sunrise Formation. The Dunlap Formation is a 3000-foot thick sequence of basal
conglomerate, limestones, clastic sediments, and volcanic flows of andesitic and
rhyolitic composition.

The strata of New York Canyon are intruded by Jurassic to
Cretaceous age multiphase domes, plugs, dikes and sills consisting primarily of
diorite and granodiorite with areas of quartz monzonite, granite and other
associated felsic rock types.

Numerous Tertiary age units (mostly Oligocene and Miocene age)
consisting of mafic to felsic volcanics, volcanoclastics, flows, tuffs,
tuffaceous sediments, and continental sediments locally overlie the older rocks.
These lithologies are of varying thicknesses ranging from 100s of feet to more
than 1000 feet.

Quaternary age deposits consisting of various alluvial and
lacustrine sediments comprise the youngest units in the area and fill the valley
bottoms and form pediments along the range fronts. These young units may be 200
feet or more thick.

Property Geology at New York Canyon

The upper New York Canyon area consists primarily of the Luning
Formation which is overlain by the Gabbs and Sunrise Formations in the Longshot
Ridge area. The Luning Formation exposed beneath the Longshot Ridge area
consists of gray to tan colored, thickbedded limestone and dolomite. Felsic
sills and dikes intrude all units in the area.

The Gabbs Formation at Longshot Ridge is extremely
calc-silicate altered. It was originally a very thin bedded to laminated
limestone and silty limestone intercalated with siltstone and shale. The Gabbs
Formation is comprised of three members: (#1) the lowest member, which is 250
feet thick, consisting of thick black bioclastic limestone intercalated with
siltstone, (#2) the middle member, 200 feet thick, consisting of predominately
argillaceous limestone intercalated with calcareous and tuffaceous siltstone,
and (#3) the upper member, from 0 to 200 feet thick, consisting of argillaceous limestone intercalated with
siltstone. The black bioclastic carbonaceous limestone at the base of the Gabbs
Formation is a distinct unit which provides a clear marker for the contact with
the underlying Luning Formation.

16

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The two lowest members of the Sunrise Formation at Longshot
Ridge are also calcsilicate altered. The Sunrise consists of five members: (#1)
the lowest member, 100 feet thick, consisting of argillaceous limestone
intercalated with siltstone and some quartz latite porphyry flows near the base,
overlain by (#2), 50 feet thick, consisting of thick-bedded fossiliferous
limestone intercalated with siltstone and silty limestone, overlain by (#3), 250
feet thick, consisting of shale and siltstone, overlain by (#4), 200 feet thick,
consisting of silty limestone and limestone, and capped by (#5), 200 feet thick,
consisting of claystone and limestone.

The Dunlap formation, mentioned in the previous description of
regional geology, is not present in the Longshot Ridge area. Similarly, only one
of the Tertiary-age volcanic sequences exists along the flank of Longshot
Ridge.

The intrusive rocks (Fi) on Longshot Ridge are primarily sills
with some local dikes. Rock types mapped at the surface and encountered in drill
holes consist of granodiorite porphyry, porphyritic quartz monzonite, quartz
monzonite porphyry and quartz-feldspar porphyry. These sills and dikes are
typically only 5 to 20 feet thick but are relatively common throughout the
area.

Rock strata on Longshot Ridge average N75°E in strike dip about
35°. The rocks are severely faulted and folded. Drag and overturned features are
common. The major faults are curvilinear with fairly high dip angles that
commonly change along the strike of the structure. The faults generally trend
either northeast or northwest, but there are some local faults that strike north
and dip steeply east. For the most part, the faults appear to have normal
displacements ranging from 50 to 200 feet.

Deposit Types at New York Canyon Project

Mineralization in the New York Canyon Project occurs
principally as contact metasomatic copper skarn deposits and as possible copper
porphyry deposits within intrusive bodies at depth beneath the skarns.

Contact metasomatic deposits include a variety of types such as
those that are copper-rich, ironrich, tungsten-rich, etc. The deposits are
commonly referred to as skarns when rich in copper and tactites when rich in
tungsten. Minerals associated with the copper-rich skarn deposits typically
include chalcopyrite, bornite, magnetite, specularite, pyrite, pyrrhotite,
sphalerite, and molybdenite. Alteration associated with the skarn deposits
converts limestone and limy sediments to higher temperature calc-silicate
minerals consisting of garnet, epidote, diopside, tremolite and calcite.

Skarn deposits are always adjacent to small to moderate sized
intrusive bodies of intermediate composition such as monzonite and granodiorite.
These intrusive bodies  occurring mainly as sills, dikes, plugs or stocks  are
the sources for the mineralizing and altering hydrothermal fluids and for the
heat that drives the fluids. Skarn mineralization develops along specific
altered beds of carbonate rock in zones of strong deformation or faulting
adjacent to the intrusive bodies.

The New York Canyon copper skarns closely fit these
descriptions. The skarns either consist mostly of oxidized minerals, as at
Longshot Ridge, or they consist of both oxidized and sulfide minerals as at the
Champion prospect west of Longshot Ridge.

Skarn type copper deposits are occasionally associated with
larger intrusive bodies that are hosts for porphyry type copper-molybdenum
deposits, such as the major Carr Fork copper skarns associated with the
world-class Bingham Canyon porphyry copper deposit in Utah. Sizes can range from
10 million to 100 million tons or more with grades of 1% to 2% Cu. Associated
metallic minerals include chalcopyrite, bornite, magnetite, specularite, pyrite,
pyrrhotite, sphalerite, and molybdenite. Other examples of significant skarn
deposits associated with large porphyry-copper deposits include Santa Rita-Pinos
Altos in New Mexico, Mason Valley-Copper Canyon in Nevada, and Mission-Pima in
Arizona.

Porphyry-type copper-molybdenum deposits are closely associated
with and related to moderate sized intrusive rock bodies of intermediate to
felsic composition. Porphyry-type mineralization consists of disseminated
sulfides and crosscutting stockwork quartz-sulfide veins or veinlets occurring
within the intrusive body and extending outward into the surrounding rocks. The intrusive bodies are
commonly 0.3 to 1 mile or more across and their emplacement produces large
volumes of altered and intensely fractured ground.

17

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At Copper Queen, the westernmost New York Canyon target, known
mineralization, incompletely explored to date, consists of both non-oxidized
copper sulfide skarns and potential porphyry-type copper-molybdenum sulfides in
the underlying intrusive body. The porphyry mineralization remains an
exploration target of possible large size based on (1) the widespread
occurrences of oxide copper showings on the surface, (2) limited geophysical
surveys, (3) apparent doming of the overlying sediments, and (4) the districts
location within the Walker Lane structural belt which hosts several large
porphyry systems such as Yerington to the northwest and Hall Mountain to the
southeast. Exploration targets for the project might range from 150 million to
400 million tons as grades of 0.4% to 0.5% copper with possible credits in
molybdenum.

Mineralization at New York Canyon Project

Mineralization in the New York Canyon Project consists of three
principal copper target areas: Longshot Ridge on the east, Champion in the
center, and Copper Queen on the west. These target areas are aligned along a
west-northwest trend that probably reflects deeper basement structures.

The Longshot Ridge and Champion prospects both contain numerous
widespread showings of copper skarn mineralization exposed in surface outcrops
and in old mine workings. In contrast, the Copper Queen prospect has no exposed
mineralization at the surface but contains copper sulfide skarn at depth and an
incompletely tested copper-molybdenum sulfide porphyry system at greater depth.
Recent exploration in the New York Canyon Project has focused mainly on the
extensive oxide copper skarn mineralization at Longshot Ridge. This
mineralization is the subject of this report.

Hydrothermal alteration and mineralization at Longshot Ridge
has formed copper-rich skarn in porous and permeable zones within sedimentary
rock strata of the Luning, Gabbs and Sunrise Formations. Additionally
copper-rich stockwork veinlets in permeable fractures occur in some of the
felsic porphyry intrusive dikes and sills that intrude the rock strata. The
alteration associated with the intrusive bodies consists of argillization,
phyllic, and silicification which are typical for rocks of this type.

The oxide copper minerals abundantly present at Longshot Ridge
are apparently products of the supergene weathering and oxidation of primary
copper sulfide minerals which were present in the original skarn. The copper
mineralization consists almost entirely of secondary copper minerals,
principally malachite, azurite, chrysocolla and copper wad. Additionally, some
copper-rich limonite (goethite) is reported. A fairly common greenish clay
alteration mineral is thought to be a zinc-bearing clay. Because limestones tend
to buffer the solutions that carry copper in a supergene environment, the copper
weathered from sulfides in the skarn migrates to the non-skarn limestone units
where it may be enriched by as much as 300 to 400 percent.

About 90 percent of the Longshot Ridge mineralization is within
the two upper units of the Gabbs Formation. Drilling results indicate that the
strongest, thickest and most continuous mineralization occurs in a
northeast-trending zone, 200 feet wide by 1300 feet long, which is crossed by
two northwest-trending structurally-controlled high grade zones, each about 100
feet wide and from 400 to 700 feet long. Mineralization in these trends is from
100 feet to 200 feet thick and covers an area of 500,000 square feet down to a
depth of 350 feet, using a 0.30% Cu/ft cutoff. Within this area are many smaller
higher-grade zones. A comparison of adjacent holes and twins of previously
drilled holes indicates this copper mineralization has good continuity.

The copper skarns and supergene enriched zones are relatively
flat lying to only gently dipping (less than 30o dip to the south). For this
reason, the thicknesses of mineralization intersected by the vertical holes
drilled to test this system represent the approximate true thicknesses of the
mineralization.

Luning Formation -these carbonates consist primarily of
dolomite and limestone. Alteration associated with these rocks includes a skarn
mineral suite consisting primarily of serpentine, talc, garnet, magnetite, and
locally diopside. The serpentine and talc minerals in skarn form sinuous veins
along the structures within the dolomite and are very diagnostic of skarn
formation in dolomite. Due to the massive nature of the Luning Formation, the
altering and mineralizing solutions closely followed high-angle cross-cutting
structures and formed limited skarn halos with only small areas of moderately
high grade copper mineralization.

18

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The Luning also has some small local zones of hematite and
dolomite containing jasperoid veins a few feet thick. These consist of
fine-grained silica, hematite, goethite, limonite and copper oxides.
Historically, all the higher-grade copper shipped from this district during
World War I was from the copper skarns in the Luning, not from the copper skarns
in the Gabbs.

Gabbs FormationThe principal host for the Longshot Ridge copper skarn deposits
are impure thin-bedded sandy limestone and siltstone in the upper two units of
the Gabbs Formation. The alteration associated with these rocks is either a
skarn mineral suite consisting of garnet, diopside and magnetite in the
limestone, or is hornfels developed in the siltstone. The copper mineralization
is much more widespread, but lower grade for the reasons stated in the previous
Luning skarn description. The diopside-rich Gabbs skarns are more abundantly
fractured and mineralized due to the brittle nature of diopside, and for this
reason these skarns are slightly higher grade than the garnet-rich skarn.
Commonly the Gabbs skarns are only a few feet thick (5 to 15 feet), but there
are many of them.

The lowest Gabbs unit, a carbonaceous bioclastic limestone, is
the location of the marble line, which is the alteration boundary between
marbleized and calc-silicate altered limestone. This unit rarely forms skarns.
The upper two units are hosts for the plentiful skarns and hornfels formed when
the hydrothermal solutions traveled up structures and outward along permeable
units. These same structures and permeable beds were later intruded by
granodiorite porphyry dikes and sills. The intrusive bodies proximal to the
skarns are most commonly sills but dikes are locally present.

Sunrise FormationThe two lowest sedimentary units of the Sunrise Formation are
impure thin-bedded sandy limestone and siltstone which are altered and
mineralized. The alteration occurs as either a skarn mineral suite consisting of
garnet, diopside and magnetite in the limestone, or as hornfels developed in the
siltstone. The copper mineralization is much more widespread, but lower grade
for the reasons stated above in the previous Luning skarn description. The
diopside-rich skarns are more abundantly fractured and mineralized due to the
brittle nature of diopside and for this reason these skarns are slightly higher
grade than the garnet-rich skarns. The skarns in the Sunrise Formation are
commonly very thick (50 feet). The largest of these is the Mayflower Mine, which
was mined on a fairly large scale. This thick skarn is capped by a thick
hornfels.

Current Exploration Program

Further exploration is recommended for the New York Canyon
Project. A two-phase exploration program is recommended to effectively test the
property. Phase One of this program will consist of re-analysis of 2006
drilling, additional metallurgical testwork, and environmental base line
studies. If results of this work are favorable, then the Phase Two program of
definition drilling, permitting and scoping studies will follow.

The estimated costs of the Phase One program are detailed in
following table and include:

- re-analysis of 2006 Longshot Ridge drill pulps, duplicate samples, blank
  samples and standards by an independent laboratory to determine the correct
  copper values;
- acquiring representative mineralized material at Longshot Ridge for
  metallurgical testwork samples to determine the optimal copper beneficiation
  process;
- initiate environmental base line studies for permitting advanced
  exploration.

A budget of $0.6 million will be necessary to support the Phase
One exploration program recommended above. The estimated costs of the Phase One
program are detailed in following table.

Re-Assaying
    $
    180,000Metallurgical Sampling and testing
    $
    125,000Environmental (Base line study work)
    $
    85,000Geological Mapping
    $
    30,000Field Supplies and support
    $
    30,000Labor
    $
    45,000Management fee
    $
    50,000Contingency
    $
    55,000Total
    $
    600,000


19

---

We commenced the Phase One exploration program in July 2011 and
anticipate that it will be completed in December, 2011.

The estimated costs of the Phase Two program are detailed in
following table and include:

- definition drilling, permitting and scoping studies designed to advance the
  Longshot Ridge project to a pre- feasibility stage;
- drill-testing geophysical targets generated from the IP survey and other
  geological targets in the Copper Queen and Champion areas;
- continuation of metallurgical testwork to refine the optimal copper
  beneficiation process for completion of a pre- feasibility study.

Analyses
    $
    450,000Drilling
    $
    1,550,000Equipment and Supplies
    $
    65,000Environmental
    $
    30,000Field Supplies and Support
    $
    145,000Geological Mapping
    $
    20,000Labor
    $
    180,000Metallurgical Testing
    $
    65,000Management Fee
    $
    200,000Contingency
    $
    295,000Total
    $
    3,000,000


A budget of $3.6 million will be necessary to support the Phase
One and Phase Two exploration programs recommended above. Our ability to
commence and complete Phase Two of our exploration program is subject to our
obtaining substantial financing, of which there is no assurance.

|ITEM 3. | LEGAL PROCEEDINGS.
|------- | ------------------

On January 29, 2007, we received a statement of claim filed in
the Ontario Superior Court of Justice from a company claiming unpaid investor
relations fees of $25,916 and requesting the balance of an alleged retainer of
$84,000. We are vigorously disputing this claim and believe this action is
without merit.

Other than the legal proceeding described above, we are not
currently a party to any legal proceedings.

20

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PART II

|ITEM 5. | MARKET FOR REGISTRANTS COMMON EQUITY,
      RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
      SECURITIES.
|------- | -------------------------------------------------------------------------------------------------------------------------

MARKET INFORMATION

Shares of our common stock trade in Canada on the TSX Venture
Exchange under the symbol CNC and over the counter in the United States on the
OTC Bulletin Board and OTCQB market place under the symbol CNYC." As our shares
of common stock were not listed on the TSX Venture Exchange until July 18, 2011,
the following table indicates the high and low bid prices of our shares of
common stock on the OTC Bulletin Board obtained during the periods
indicated:

2011
    
    
    2010High
    
    
    Low
    
    
    High
    
    
    LowFirst Quarter ended September 30
    $
    0.13
    
    $
    0.05
    
    $
    0.20
    
    $
    0.05Second Quarter ended December 31
    $
    0.35
    
    $
    0.05
    
    $
    0.10
    
    $
    0.05Third Quarter ended March 31
    $
    0.45
    
    $
    0.25
    
    $
    0.085
    
    $
    0.03Fourth Quarter ended June 30
    $
    0.40
    
    $
    0.28
    
    $
    0.03
    
    $
    0.03


The above quotations have been adjusted to reflect our
79-for-100 reverse split effective November 24, 2010. Quotations entered on the
OTC Bulletin Board reflect inter-dealer prices, without retail mark-up,
mark-down or commission and may not represent actual transactions.

HOLDERS OF OUR COMMON STOCK

As of September 26, 2011, we had 167 registered holders of our
common stock holding an aggregate of 68,396,934. We believe a large number of
stockholders hold stock on deposit with their brokers or investment bankers
registered in the name of depositories.

We are in preliminary negotiations with the liquidators of
Langley Park Investment Trust plc (Langley Park) to repurchase the Series A
Convertible Preferred Stock (the Preferred Stock). However, there is no
assurance that we will reach an agreement with the liquidators of Langley
Park.

DIVIDENDS

We have neither declared nor paid any cash dividends on our
capital stock since our inception and do not contemplate paying cash dividends
in the foreseeable future. It is anticipated that earnings, if any, will be
retained for the operation of our business. Our board of directors will
determine future dividend declarations and payments, if any, in light of the
then-current conditions they deem relevant and in accordance with Chapter 78 of
Nevada Revised Statutes (the NRS).

There are no restrictions in our articles of incorporation or
in our bylaws which prevent us from declaring dividends. Chapter 78 of NRS,
however, does prohibit us from declaring dividends where, after giving effect to
the distribution of a dividend:

| | (a) | We would not be able to pay our debts as they become due
      in the usual course of business; or                                                                                                                                       
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                          
| | (b) | Our total assets would be less than the sum of our total
      liabilities plus the amount that would be needed to satisfy the rights of
      shareholders who have preferential rights superior to those receiving
      distributions.

RECENT SALES OF UNREGISTERED SECURITIES

All unregistered sales of our equity securities made during the
fiscal year ended June 30, 2011 have been previously reported in our Quarterly
Reports on Form 10-Q and our Current Reports on Form 8-K.

21

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ITEM 7.
    MANAGEMENT'S DISCUSSION AND
      ANALYSIS OF FINANCIAL CONDITION AND
      RESULTS OF OPERATIONS.


PLAN OF OPERATION

Over the next twelve months, our plan of operation is to
re-analyze the 2006 Longshot Ridge drill pulps and to initiate environmental
base line studies, which will permit us to conduct advanced exploration if
warranted. In order to implement our exploration program and to continue our
operations, we anticipate that we will require the following:

ITEM AND ACTIVITY
    
    12 Month Total
      BudgetLAND STATUS2011 - 2012 unpatented claim maintenance fees
    $
    190,000Monthly Payments  Patented Claims
    
    42,000EXPLORATION PROGRAMRe-assay 2006 Longshot Ridge drill pulps
    
    180,000Metallurgical sampling and testing
    
    125,000Environmental base line study work
    
    85,000Geological mapping
    
    30,000Filed supplies and support
    
    30,000Management fee
    
    50,000Contingency
    
    55,000GENERAL AND ADMINISTRATIVE EXPENSESGeneral and Administrative
    
    258,000TOTAL
    $
    1,090,000


As at June 30, 2011, we had cash of $1,226,964. Subsequent to
June 30, 2011, we raised proceeds of CDN $1,057,425 (USD $1,096,549.73) from the
sale of our securities. For the next twelve months, management anticipates that
the minimum cash requirements to fund our proposed exploration program and our
continued operations will be $1,090,000. Accordingly, we have sufficient funds
to meet our planned expenditures over the next twelve months. In the event that
we wish to proceed with phase two of our exploration program, of which there is
no assurance, we will be required to raise substantial financing. However, there
is no assurance we will be successful in raising such funding or on terms that
are acceptable to us. Since inception, we have been dependent on investment
capital and debt financing from third parties as our primary source of
liquidity. We anticipate continuing to rely on sales of shares of our common
stock and loans in order to continue to fund our business operations. Issuances
of additional shares will result in further dilution of our existing
shareholders.

RESULTS OF OPERATIONS

|Summary of Year End Results |   |               |   |   |               |   |  |                     | 
|--------------------------- | - | ------------- | - | - | ------------- | - |  | ------------------- | 
|                            |   | Year Ended    |   |   | Year Ended    |   |  | Percentage          | 
|                            |   | June 30, 2011 |   |   | June 30, 2010 |   |  | Increase / Decrease | 
|Revenue                     | $ | -             |   | $ | -             |   |  | n/a                 | 
|Operating Expenses          |   | (841,815      | ) |   | (1,056,103    | ) |  | (20.3)%             | 
|Other Income (Expense)      |   | (10,466       | ) |   | (1,169        | ) |  | 795.3%              | 
|Net Loss                    | $ | (852,281      | ) | $ | (1,057,272    | ) |  | (19.4)%             | 

Revenue

We have not earned any revenues to date and do not anticipate
earning revenues until such time as we enter into commercial production of our
mineral properties. There can be no assurance that we will be successful in
discovering commercial quantities or that we can commercially produce metals or
minerals. We are presently an exploration stage company engaged in the search
for mineral reserves. We can provide no assurances that we will be able to discover any commercially exploitable levels of
mineral resources on our property, or, even if such resources are discovered,
that we will be able to enter into commercial production of our mineral
properties.

22

---

Expenses

The major components of our expenses for the year are outlined
in the table below:

|                                           |   | Year
      Ended    |   |   | Year
      Ended    |  |  | Percentage          | 
|------------------------------------------ | - | ------------------- | - | - | ------------------- |  |  | ------------------- | 
|                                           |   | June
      30, 2011 |   |   | June
      30, 2010 |  |  | Increase / Decrease | 
|Operating expenses:                        |   |                     |   |   |                     |  |  |                     | 
|Foreign exchange loss                      | $ | 41,050              |   | $ | 29,448              |  |  | 39.4%               | 
|General and administrative                 |   | 395,371             |   |   | 716,684             |  |  | (44.8)%             | 
|Mineral exploration costs                  |   | 405,394             |   |   | 309,971             |  |  | 30.8%               | 
|Sub-total                                  | $ | 841,815             |   | $ | 1,056,103           |  |  | (20.3)%             | 
|Other (income) expense:                    |   |                     |   |   |                     |  |  |                     | 
|Gain on change in fair value of derivative |   | (7,024              | ) |   | -                   |  |  | n/a                 | 
|liabilities                                |   |                     |   |   |                     |  |  |                     | 
|Interest expense                           |   | 17,490              |   |   | 1,169               |  |  | 1,396.2%            | 
|Sub-total                                  | $ | 10,466              |   | $ | 1,169               |  |  | 795.3%              | 
|Total Expenses                             | $ | 852,281             |   | $ | 1,057,272           |  |  | (19.4)%             | 

Our operating expenses decreased from $1,056,103, during the
year ended June 30, 2010, to $841,815, during the year ended June 30, 2011. The
decrease in our operating expenses is due to a decrease in general and
administrative expenses. This amount was partially offset by increases in
mineral exploration costs and foreign exchange loss.

In fiscal 2011, general and administration expenses primarily
consisted of: (i) consulting fees incurred for services provided by our
executive officers; and (ii) legal and accounting fees in connection with our
listing on the TSX Venture Exchange and meeting our ongoing reporting
requirements under the Exchange Act. Additional general and administrative
expenses in fiscal 2010 are mainly due to the fact that we recorded stock-based
compensation of $362,614.

Mineral exploration costs consisted of annual payments to
maintain the New York Canyon Project in good standing, mineral lease payments
and consulting fees in connection with our New York Canyon Project.

LIQUIDITY AND CAPITAL RESOURCES

|Working Capital           |   |                        |  |   |                        |   |  |                     | 
|------------------------- | - | ---------------------- |  | - | ---------------------- | - |  | ------------------- | 
|                          |   |                        |  |   |                        |   |  | Percentage          | 
|                          |   | At
      June 30, 2011 |  |   | At
      June 30, 2010 |   |  | Increase / Decrease | 
|Current Assets            | $ | 1,270,655              |  | $ | 256,269                |   |  | 395.8%              | 
|Current Liabilities       |   | 780,265                |  |   | 437,523                |   |  | 78.3%               | 
|Working Capital (Deficit) | $ | 490,390                |  | $ | (181,254               | ) |  | 370.6%              | 

|Cash Flows                                      |   |                     |   |   |                     |  
|----------------------------------------------- | - | ------------------- | - | - | ------------------- | -
|                                                |   | Year Ended          |   |   | Year Ended          |  
|                                                |   | June
      30, 2011 |   |   | June
      30, 2010 |  
|Cash Flows used in Operating Activities         | $ | (678,759            | ) | $ | (709,687            | )
|Cash Flows used in Investing Activities         |   | -                   |   |   | -                   |  
|Cash Flows provided by Financing Activities     |   | 1,652,805           |   |   | 535,489             |  
|Net Increase (decrease) in Cash During the Year | $ | 974,046             |   | $ | (174,198            | )

Our working capital increased from a deficit of $181,254, as at
June 30, 2010, to a surplus of $490,390, as at June 30, 2011. The increase in
working capital was primarily a result of the fact that we raised proceeds of $1,514,130 from the sale of our common stock. This amount was
primarily offset by an increase in accounts payable and amounts due to related
parties.

23

---

During the year ended June 30, 2011, we completed the following
private placement financings:

|(a) | a non-brokered offering of 3,304,458 units for gross
      proceeds of CDN $1,146,560.70 (USD $1,206,419) pursuant to Regulation S
      of the Securities Act; and
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                    
|(b) | a non-brokered offering of 142,857 units for gross
      proceeds of CDN $50,000 (USD $52,187) pursuant to Section 4(2) of the
      Securities Act.               

Subsequent to the year ended June 30, 2011, we completed the
following private placement financings:

|(a) | a brokered offering of 2,164,071 units for gross proceeds
      of CDN $757,424.85 (USD $785,449.57) pursuant to Regulation S of the
      Securities Act; and
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                               
|(b) | a non-brokered offering of 857,142 units for gross
      proceeds of CDN $300,000 (USD $311,100) pursuant to Regulation S of the
      Securities Act.        

Future Financings

Our plan of operation calls for significant expenses in
connection with the exploration of the New York Canyon Project. For the next
twelve months, management anticipates that the minimum cash requirements to fund
our proposed exploration program and our continued operations will be
$1,090,000. We have sufficient funds to meet our planned expenditures over the
next twelve months. In the event that we wish to proceed with phase two of our
exploration program on the New York Canyon Project, we will need to seek
financing to meet our planned expenditures. There is no assurance that we will
be able to obtain financing in the future.

Obtaining financing is subject to a number of factors,
including the market prices for the mineral property and copper. These factors
may make the timing, amount, terms or conditions of additional financing
unavailable to us. Since our inception, we have used our common stock to raise
money for our operations and for our property acquisitions. We have not attained
profitable operations and are dependent upon obtaining financing to pursue our
plan of operation. For these reasons, our independent auditors believe there
exists a substantial doubt about our ability to continue as a going concern.

OFF-BALANCE SHEET ARRANGEMENTS

None.

CRITICAL ACCOUNTING POLICIES

We have identified certain accounting policies, described
below, that are most important to the portrayal of our current financial
condition and results of operations. Our significant accounting policies are
disclosed in Note 2 to our audited financial statements included in this Annual
Report for the year ended June 30, 2011.

Mineral Property Costs

We have been in the exploration stage since our inception on
January 21, 2000 and have not yet realized any revenues from our planned
operations. We are primarily engaged in the acquisition and exploration of
mining properties. Mineral property exploration costs are expensed as incurred.
Mineral property acquisition costs are initially capitalized. We assess the
carrying costs for impairment under ASC 360, Property, Plant, and Equipment at
each fiscal quarter end. When we have been determined that a mineral property
can be economically developed as a result of establishing proven and probable
reserves, the costs then incurred to develop such property, are capitalized.
Such costs will be amortized using the units-of-production method over the
estimated life of the probable reserve. If mineral properties are subsequently
abandoned or impaired, any capitalized costs will be charged to operations.

24

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Long-Lived Assets

In accordance with ASC 360, Property, Plant and
Equipment, we test long-lived assets or asset groups for recoverability when
events or changes in circumstances indicate that their carrying amount may not
be recoverable. Circumstances which could trigger a review include, but are not
limited to: significant decreases in the market price of the asset; significant
adverse changes in the business climate or legal factors; accumulation of costs
significantly in excess of the amount originally expected for the acquisition or
construction of the asset; current period cash flow or operating losses combined
with a history of losses or a forecast of continuing losses associated with the
use of the asset; and current expectation that the asset will more likely than
not be sold or disposed significantly before the end of its estimated useful
life. Recoverability is assessed based on the carrying amount of the asset and
its fair value which is generally determined based on the sum of the
undiscounted cash flows expected to result from the use and the eventual
disposal of the asset, as well as specific appraisal in certain instances. An
impairment loss is recognized when the carrying amount is not recoverable and
exceeds fair value.

Stock-Based Compensation

We record stock-based compensation in accordance with ASC 718,
Compensation  Stock Based Compensation and ASC 505, Equity Based Payments to
Non-Employees, which requires the measurement and recognition of compensation
expense based on estimated fair values for all share-based awards made to
employees and directors, including stock options.

ASC 718 requires companies to estimate the fair value of
share-based awards on the date of grant using an option-pricing model. We use
the Black-Scholes option-pricing model as its method of determining fair value.
This model is affected by our stock price as well as assumptions regarding a
number of subjective variables. These subjective variables include, but are not
limited to our expected stock price volatility over the term of the awards, and
actual and projected employee stock option exercise behaviors. The value of the
portion of the award that is ultimately expected to vest is recognized as an
expense in the statement of operations over the requisite service period.

All transactions in which goods or services are the
consideration received for the issuance of equity instruments are accounted for
based on the fair value of the consideration received or the fair value of the
equity instrument issued, whichever is more reliably measurable.

25

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|ITEM 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY
      DATA.
|------- | --------------------------------------------------

Index to Financial Statements

|1. | Report of Independent Registered Public Accounting
      Firm;                                                                  
|-- | --------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                 
|3. | Balance Sheets as at June 30, 2011 and 2010;                                                                                    
|   |                                                                                                                                 
|4. | Statements of Operations for the years ended June 30,
      2011 and 2010 and accumulated from inception to June 30, 2011;      
|   |                                                                                                                                 
|5. | Statement of Stockholders Equity (Deficit) for the
      period from inception to June 30, 2011;                               
|   |                                                                                                                                 
|6. | Statements of Cash Flows for the years ended June 30,
      2011 and 2010 and accumulated from inception to June 30, 2011;
  and
|   |                                                                                                                                 
|7. | Notes to the Financial
Statements.                                                                                              

26

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|CANYON COPPER CORP.           
|------------------------------
|(An Exploration Stage Company)
|June 30, 2011                 
|(Expressed in U.S. dollars)   

|                                                              | Index
|------------------------------------------------------------- | -----
|Report of Independent Registered
      Public Accounting Firm | F1  
|Balance Sheets                                                | F2  
|Statements of Operations                                      | F3  
|Statement of Stockholders Equity
      (Deficit)             | F4  
|Statements of Cash Flows                                      | F9  
|Notes to the Financial Statements                             | F10 

---



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM

To the Board of Directors and Stockholders of Canyon Copper
Corp.(An Exploration Stage Company)

We have audited the accompanying balance sheets of Canyon
Copper Corp. (An Exploration Stage Company) as of June 30, 2011 and 2010, and
the related statements of operations, stockholders equity (deficit), and cash
flows for the years then ended and accumulated from July 1, 2009 to June 30,
2011. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. The Company is not required to have,
nor were we engaged to perform, an audit of its internal control over financial
reporting. An audit includes consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of internal control over financial reporting. Accordingly, we
express no such opinion. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position of the Company
as of June 30, 2011 and 2010, and the results of its operations and its cash
flows for the years then ended and accumulated from July 1, 2009 to June 30,
2011, in conformity with accounting principles generally accepted in the United
States.

The accompanying financial statements have been prepared
assuming the Company will continue as a going concern. As discussed in Note 1 to
the financial statements, the Company has not generated any revenues and has
incurred operating losses since inception. These factors raise substantial doubt
about the Companys ability to continue as a going concern. Managements plans
in regard to these matters are also discussed in Note 1 to the financial
statements. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

/s/ SATURNA GROUP CHARTERED ACCOUNTANTS LLP

Saturna Group Chartered Accountants LLP

Vancouver, Canada

September 23, 2011

F-1

---

|CANYON COPPER CORP.           
|------------------------------
|(An Exploration Stage Company)
|Balance Sheets                
|(Expressed in U.S. dollars)   

|                                                                                                                                                                   |  | June 30,    |   |  | June 30,    |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ----------- | - |  | ----------- | -
|                                                                                                                                                                   |  | 2011        |   |  | 2010        |  
|                                                                                                                                                                   |  | $           |   |  | $           |  
|                                                                                                                                                                   |  |             |   |  |             |  
|ASSETS                                                                                                                                                             |  |             |   |  |             |  
|Current Assets                                                                                                                                                     |  |             |   |  |             |  
|Cash                                                                                                                                                               |  | 1,226,964   |   |  | 252,918     |  
|Prepaid expenses and deposits                                                                                                                                      |  | 43,691      |   |  | 3,351       |  
|Total Current Assets                                                                                                                                               |  | 1,270,655   |   |  | 256,269     |  
|Deferred financing
      costs                                                                                                                                     |  | 60,965      |   |  |            |  
|Total Assets                                                                                                                                                       |  | 1,331,620   |   |  | 256,269     |  
|                                                                                                                                                                   |  |             |   |  |             |  
|LIABILITIES AND STOCKHOLDERS EQUITY
      (DEFICIT)                                                                                                               |  |             |   |  |             |  
|Current Liabilities                                                                                                                                                |  |             |   |  |             |  
|Accounts payable                                                                                                                                                   |  | 188,837     |   |  | 142,655     |  
|Accrued liabilities                                                                                                                                                |  |            |   |  | 2,288       |  
|Due to related parties (Note 4)                                                                                                                                    |  | 591,428     |   |  | 292,580     |  
|Total Current Liabilities                                                                                                                                          |  | 780,265     |   |  | 437,523     |  
|Due to related parties (Note
      4)                                                                                                                              |  | 77,784      |   |  |            |  
|Derivative liabilities (Note 5)                                                                                                                                    |  | 389,826     |   |  |            |  
|Total Liabilities                                                                                                                                                  |  | 1,247,875   |   |  | 437,523     |  
|                                                                                                                                                                   |  |             |   |  |             |  
|Nature of Operations and Continuance of
      Business (Note 1)                                                                                                    |  |             |   |  |             |  
|Contingent Liability (Note 9)                                                                                                                                      |  |             |   |  |             |  
|Commitment (Note 10)                                                                                                                                               |  |             |   |  |             |  
|Subsequent Event (Note 13)                                                                                                                                         |  |             |   |  |             |  
|                                                                                                                                                                   |  |             |   |  |             |  
|Stockholders Equity (Deficit)                                                                                                                                     |  |             |   |  |             |  
|Preferred stock
            Authorized: 100,000,000 shares, par
      value $0.00001       Issued and outstanding:
      500,000 shares                            |  | 5           |   |  | 5           |  
|Common stock
            Authorized: 131,666,666 shares, par
      value $0.00001       Issued and outstanding:
      65,375,721 shares (2010  61,928,163 shares) |  | 654         |   |  | 619         |  
|Additional paid-in capital                                                                                                                                         |  | 21,620,854  |   |  | 20,803,609  |  
|Common stock subscribed                                                                                                                                            |  | 300,000     |   |  |            |  
|Deficit accumulated during the exploration stage                                                                                                                   |  | (21,837,768 | ) |  | (20,985,487 | )
|Total
      Stockholders Equity (Deficit)                                                                                                                         |  | 83,745      |   |  | (181,254    | )
|Total Liabilities and Stockholders Equity (Deficit)                                                                                                               |  | 1,331,620   |   |  | 256,269     |  

(The accompanying notes are an integral part of these financial
statements)

F-2

---

|CANYON COPPER CORP.           
|------------------------------
|(An Exploration Stage Company)
|Statements of Operations      
|(Expressed in U.S. dollars)   

|                                                             |  |            |   |  |                     |   |  | Accumulated      |  
|------------------------------------------------------------ |  | ---------- | - |  | ------------------- | - |  | ---------------- | -
|                                                             |  |            |   |  |                     |   |  | From             |  
|                                                             |  |            |   |  |                     |   |  | January 21, 2000 |  
|                                                             |  | Year Ended |   |  | (date of inception) |  
|                                                             |  | June 30,   |   |  | to June 30,         |  
|                                                             |  | 2011       |   |  | 2010                |   |  | 2011             |  
|                                                             |  | $          |   |  | $                   |   |  | $                |  
|                                                             |  |            |   |  |                     |   |  |                  |  
|Revenue                                                      |  |           |   |  |                    |   |  |                 |  
|                                                             |  |            |   |  |                     |   |  |                  |  
|Operating Expenses                                           |  |            |   |  |                     |   |  |                  |  
|                                                             |  |            |   |  |                     |   |  |                  |  
|Depreciation                                                 |  |           |   |  |                    |   |  | 5,540            |  
|Foreign exchange loss                                        |  | 41,050     |   |  | 29,448              |   |  | 16,569           |  
|General and administrative
      (Note 4)                    |  | 395,371    |   |  | 716,684             |   |  | 9,864,765        |  
|Impairment of mineral property costs                         |  |           |   |  |                    |   |  | 2,759,130        |  
|Impairment of property and
      equipment                   |  |           |   |  |                    |   |  | 10,811           |  
|Mineral exploration costs                                    |  | 405,394    |   |  | 309,971             |   |  | 5,330,867        |  
|                                                             |  |            |   |  |                     |   |  |                  |  
|Total Operating
      Expenses                               |  | 841,815    |   |  | 1,056,103           |   |  | 17,987,682       |  
|                                                             |  |            |   |  |                     |   |  |                  |  
|Operating Loss                                               |  | (841,815   | ) |  | (1,056,103          | ) |  | (17,987,682      | )
|                                                             |  |            |   |  |                     |   |  |                  |  
|Other Income (Expense)                                       |  |            |   |  |                     |   |  |                  |  
|                                                             |  |            |   |  |                     |   |  |                  |  
|Accretion of discounts on convertible debt                   |  |           |   |  |                    |   |  | (799,963         | )
|Debt conversion expense                                      |  |           |   |  |                    |   |  | (2,010,076       | )
|Gain on change in fair value of derivative
      liabilities |  | 7,024      |   |  |                    |   |  | 439,739          |  
|Gain on write-off of accounts
      payable                  |  |           |   |  |                    |   |  | 3,020            |  
|Loss on settlement of related party debt                     |  |           |   |  |                    |   |  | (2,871           | )
|Impairment of investment
      securities                    |  |           |   |  |                    |   |  | (459,817         | )
|Interest expense                                             |  | (17,490    | ) |  | (1,169              | ) |  | (356,234         | )
|Loss on extinguishment of debt                               |  |           |   |  |                    |   |  | (252,454         | )
|Loss
      on sale of investment securities                  |  |           |   |  |                    |   |  | (411,430         | )
|                                                             |  |            |   |  |                     |   |  |                  |  
|Total Other Income
      (Expense)                           |  | (10,466    | ) |  | (1,169              | ) |  | (3,850,086       | )
|                                                             |  |            |   |  |                     |   |  |                  |  
|Net Loss                                                     |  | (852,281   | ) |  | (1,057,272          | ) |  | (21,837,768      | )
|                                                             |  |            |   |  |                     |   |  |                  |  
|Net Loss Per
      Share, Basic and Diluted                  |  | (0.01      | ) |  | (0.02               | ) |  |                  |  
|                                                             |  |            |   |  |                     |   |  |                  |  
|Weighted Average
      Shares Outstanding                    |  | 62,393,000 |   |  | 60,606,000          |   |  |                  |  

(The accompanying notes are an integral part of these financial
statements)

F-3

---

|CANYON COPPER CORP.                                       
|----------------------------------------------------------
|(An Exploration Stage Company)                            
|Statement of Stockholders Equity (Deficit)               
|From January 21, 2000 (Date of Inception) to June 30, 2011
|(Expressed in U.S. dollars)                               

|                                                                                   |  |                 |  |  |              |  |  |             |   |  |        |   |  |             |   |  |            |  |  | Deficit     |   |  |            |  
|---------------------------------------------------------------------------------- |  | --------------- |  |  | ------------ |  |  | ----------- | - |  | ------ | - |  | ----------- | - |  | ---------- |  |  | ----------- | - |  | ---------- | -
|                                                                                   |  |                 |  |  |              |  |  |             |   |  |        |   |  |             |   |  |            |  |  | Accumulated |   |  |            |  
|                                                                                   |  |                 |  |  |              |  |  |             |   |  |        |   |  | Additional  |   |  | Common     |  |  | During the  |   |  |            |  
|                                                                                   |  | Preferred Stock |  |  | Common Stock |  |  | Paid-in     |   |  | Stock  |   |  | Exploration |   |  |            | 
|                                                                                   |  | Shares          |  |  | Amount       |  |  | Shares      |   |  | Amount |   |  | Capital     |   |  | Subscribed |  |  | Stage       |   |  | Total      |  
|                                                                                   |  | #               |  |  | $            |  |  | #           |   |  | $      |   |  | $           |   |  | $          |  |  | $           |   |  | $          |  
|Balance, January 21, 2000 (date of
      inception)                                |  |                |  |  |             |  |  |            |   |  |       |   |  |            |   |  |           |  |  |            |   |  |           |  
|Issuance of stock for services and payment of advances for
      $0.0076 per share |  |                |  |  |             |  |  | 36,340,000  |   |  | 364    |   |  | 274,636     |   |  |           |  |  |            |   |  | 275,000    |  
|Net loss for the period                                                            |  |                |  |  |             |  |  |            |   |  |       |   |  |            |   |  |           |  |  | (290,820    | ) |  | (290,820   | )
|Balance, June 30, 2000                                                             |  |                |  |  |             |  |  | 36,340,000  |   |  | 364    |   |  | 274,636     |   |  |           |  |  | (290,820    | ) |  | (15,820    | )
|Net loss for the year                                                              |  |                |  |  |             |  |  |            |   |  |       |   |  |            |   |  |           |  |  | (11,766     | ) |  | (11,766    | )
|Balance, June 30, 2001                                                             |  |                |  |  |             |  |  | 36,340,000  |   |  | 364    |   |  | 274,636     |   |  |           |  |  | (302,586    | ) |  | (27,586    | )
|Issuance of stock for cash at $0.0138 per
      share                              |  |                |  |  |             |  |  | 5,407,501   |   |  | 54     |   |  | 74,347      |   |  |           |  |  |            |   |  | 74,401     |  
|Net
      loss for the year                                                        |  |                |  |  |             |  |  |            |   |  |       |   |  |            |   |  |           |  |  | (43,817     | ) |  | (43,817    | )
|Balance, June 30, 2002                                                             |  |                |  |  |             |  |  | 41,747,501  |   |  | 418    |   |  | 348,983     |   |  |           |  |  | (346,403    | ) |  | 2,998      |  
|Net
      loss for the year                                                        |  |                |  |  |             |  |  |            |   |  |       |   |  |            |   |  |           |  |  | (17,713     | ) |  | (17,713    | )
|Balance, June 30, 2003                                                             |  |                |  |  |             |  |  | 41,747,501  |   |  | 418    |   |  | 348,983     |   |  |           |  |  | (364,116    | ) |  | (14,715    | )
|Cancellation of stock owned by a director                                          |  |                |  |  |             |  |  | (23,173,333 | ) |  | (232   | ) |  | 232         |   |  |           |  |  |            |   |  |           |  
|Conversion of debentures                                                           |  |                |  |  |             |  |  |            |   |  |       |   |  |            |   |  | 902,126    |  |  |            |   |  | 902,126    |  
|Issuance of stock for cash at $5.6962 per share                                    |  |                |  |  |             |  |  | 184,333     |   |  | 2      |   |  | 1,049,998   |   |  |           |  |  |            |   |  | 1,050,000  |  
|Stock issuance costs                                                               |  |                |  |  |             |  |  |            |   |  |       |   |  | (105,000    | ) |  |           |  |  |            |   |  | (105,000   | )
|Net
      loss for the year                                                        |  |                |  |  |             |  |  |            |   |  |       |   |  |            |   |  |           |  |  | (1,601,036  | ) |  | (1,601,036 | )
|Balance, June 30, 2004                                                             |  |                |  |  |             |  |  | 18,758,501  |   |  | 188    |   |  | 1,294,213   |   |  | 902,126    |  |  | (1,965,152  | ) |  | 231,375    |  

(The accompanying notes are an integral part of these financial
statements)

F-4

---

|CANYON COPPER CORP.                                       
|----------------------------------------------------------
|(An Exploration Stage Company)                            
|Statement of Stockholders Equity (Deficit)               
|From January 21, 2000 (Date of Inception) to June 30, 2011
|(Expressed in U.S. dollars)                               

|                                                                       |  |                 |  |  |              |  |  |            |   |  |        |   |  |               |   |  |             |   |  |             |   |  | Deficit     |   |  |            |  
|---------------------------------------------------------------------- |  | --------------- |  |  | ------------ |  |  | ---------- | - |  | ------ | - |  | ------------- | - |  | ----------- | - |  | ----------- | - |  | ----------- | - |  | ---------- | -
|                                                                       |  |                 |  |  |              |  |  |            |   |  |        |   |  |               |   |  |             |   |  | Accumulated |   |  | Accumulated |   |  |            |  
|                                                                       |  |                 |  |  |              |  |  |            |   |  |        |   |  | Additional    |   |  | Common      |   |  | Other       |   |  | During the  |   |  |            |  
|                                                                       |  | Preferred Stock |  |  | Common Stock |  |  | Paid-in    |   |  | Stock  |   |  | Comprehensive |   |  | Exploration |   |  |             |  
|                                                                       |  | Shares          |  |  | Amount       |  |  | Shares     |   |  | Amount |   |  | Capital       |   |  | Subscribed  |   |  | Loss        |   |  | Stage       |   |  | Total      |  
|                                                                       |  | #               |  |  | $            |  |  | #          |   |  | $      |   |  | $             |   |  | $           |   |  | $           |   |  | $           |   |  | $          |  
|                                                                       |  |                 |  |  |              |  |  |            |   |  |        |   |  |               |   |  |             |   |  |             |   |  |             |   |  |            |  
|Balance, June 30, 2004                                                 |  |                |  |  |             |  |  | 18,758,501 |   |  | 188    |   |  | 1,294,213     |   |  | 902,126     |   |  |            |   |  | (1,965,152  | ) |  | 231,375    |  
|                                                                       |  |                 |  |  |              |  |  |            |   |  |        |   |  |               |   |  |             |   |  |             |   |  |             |   |  |            |  
|Issuance of stock for
      consulting services                        |  |                |  |  |             |  |  | 105,333    |   |  | 1      |   |  | 761,999       |   |  |            |   |  |            |   |  |            |   |  | 762,000    |  
|Cancellation of stock issued for consulting
      services             |  |                |  |  |             |  |  | (52,667    | ) |  | (1     | ) |  | (727,999      | ) |  |            |   |  |            |   |  |            |   |  | (728,000   | )
|Issuance of stock pursuant to
      the exercise of options            |  |                |  |  |             |  |  | 105,333    |   |  | 1      |   |  | 199,999       |   |  |            |   |  |            |   |  |            |   |  | 200,000    |  
|                                                                       |  |                 |  |  |              |  |  |            |   |  |        |   |  |               |   |  |             |   |  |             |   |  |             |   |  |            |  
|Issuance of stock pursuant to
      conversion of debentures           |  |                |  |  |             |  |  | 144,677    |   |  | 1      |   |  | 902,125       |   |  | (902,126    | ) |  |            |   |  |            |   |  |           |  
|Issuance of stock pursuant to mineral
      property option agreements |  |                |  |  |             |  |  | 371,300    |   |  | 4      |   |  | 1,876,496     |   |  |            |   |  |            |   |  |            |   |  | 1,876,500  |  
|Issuance of stock to settle
      related party debt                   |  |                |  |  |             |  |  | 52,044     |   |  | 1      |   |  | 73,123        |   |  |            |   |  |            |   |  |            |   |  | 73,124     |  
|Cancellation of stock owned by the President
      of the Company      |  |                |  |  |             |  |  | (5,266,667 | ) |  | (53    | ) |  | 53            |   |  |            |   |  |            |   |  |            |   |  |           |  
|Issuance of preferred stock
      for investment securities            |  | 500,000         |  |  | 5            |  |  |           |   |  |       |   |  | 1,382,013     |   |  |            |   |  |            |   |  |            |   |  | 1,382,018  |  
|Unrealized loss on investment securities                               |  |                |  |  |             |  |  |           |   |  |       |   |  |              |   |  |            |   |  | (437,712    | ) |  |            |   |  | (437,712   | )
|                                                                       |  |                 |  |  |              |  |  |            |   |  |        |   |  |               |   |  |             |   |  |             |   |  |             |   |  |            |  
|Fair value of stock options granted                                    |  |                |  |  |             |  |  |           |   |  |       |   |  | 384,144       |   |  |            |   |  |            |   |  |            |   |  | 384,144    |  
|Intrinsic value of beneficial
      conversion features                |  |                |  |  |             |  |  |           |   |  |       |   |  | 180,183       |   |  |            |   |  |            |   |  |            |   |  | 180,183    |  
|                                                                       |  |                 |  |  |              |  |  |            |   |  |        |   |  |               |   |  |             |   |  |             |   |  |             |   |  |            |  
|Net loss for the year                                                  |  |                |  |  |             |  |  |           |   |  |       |   |  |              |   |  |            |   |  |            |   |  | (4,025,401  | ) |  | (4,025,401 | )
|                                                                       |  |                 |  |  |              |  |  |            |   |  |        |   |  |               |   |  |             |   |  |             |   |  |             |   |  |            |  
|Balance, June 30, 2005                                                 |  | 500,000         |  |  | 5            |  |  | 14,217,854 |   |  | 142    |   |  | 6,326,349     |   |  |            |   |  | (437,712    | ) |  | (5,990,553  | ) |  | (101,769   | )

(The accompanying notes are an integral part of these financial
statements)

F-5

---

|CANYON COPPER CORP.                                       
|----------------------------------------------------------
|(An Exploration Stage Company)                            
|Statement of Stockholders Equity (Deficit)               
|From January 21, 2000 (Date of Inception) to June 30, 2011
|(Expressed in U.S. dollars)                               

|                                                                                 |  |                 |  |  |              |  |  |            |  |  |               |  |  |             |   |  |             |   |  | Deficit     |   |  |            |  
|-------------------------------------------------------------------------------- |  | --------------- |  |  | ------------ |  |  | ---------- |  |  | ------------- |  |  | ----------- | - |  | ----------- | - |  | ----------- | - |  | ---------- | -
|                                                                                 |  |                 |  |  |              |  |  |            |  |  |               |  |  |             |   |  | Accumulated |   |  | Accumulated |   |  |            |  
|                                                                                 |  |                 |  |  |              |  |  |            |  |  |               |  |  | Additional  |   |  | Other       |   |  | During the  |   |  |            |  
|                                                                                 |  | Preferred Stock |  |  | Common Stock |  |  | Paid-in    |  |  | Comprehensive |  |  | Exploration |   |  |             |  
|                                                                                 |  | Shares          |  |  | Amount       |  |  | Shares     |  |  | Amount        |  |  | Capital     |   |  | Loss        |   |  | Stage       |   |  | Total      |  
|                                                                                 |  | #               |  |  | $            |  |  | #          |  |  | $             |  |  | $           |   |  | $           |   |  | $           |   |  | $          |  
|                                                                                 |  |                 |  |  |              |  |  |            |  |  |               |  |  |             |   |  |             |   |  |             |   |  |            |  
|Balance, June 30, 2005                                                           |  | 500,000         |  |  | 5            |  |  | 14,217,854 |  |  | 142           |  |  | 6,326,349   |   |  | (437,712    | ) |  | (5,990,553  | ) |  | (101,769   | )
|Issuance of stock for cash at $0.9494 per
      share                            |  |                |  |  |             |  |  | 1,316,667  |  |  | 13            |  |  | 1,249,987   |   |  |            |   |  |            |   |  | 1,250,000  |  
|Issuance of stock for cash at
      $1.1392 per share                            |  |                |  |  |             |  |  | 395,000    |  |  | 4             |  |  | 449,996     |   |  |            |   |  |            |   |  | 450,000    |  
|Issuance of stock for geological data at a
      fair value of $1.4811 per share |  |                |  |  |             |  |  | 6,583      |  |  |              |  |  | 9,750       |   |  |            |   |  |            |   |  | 9,750      |  
|Issuance of stock to settle
      debt at a fair value of $1.405 per share       |  |                |  |  |             |  |  | 16,786     |  |  |              |  |  | 23,585      |   |  |            |   |  |            |   |  | 23,585     |  
|Issuance of stock for cash at $1.519 per
      share                             |  |                |  |  |             |  |  | 1,178,417  |  |  | 12            |  |  | 1,789,988   |   |  |            |   |  |            |   |  | 1,790,000  |  
|Share issuance costs                                                             |  |                |  |  |             |  |  |           |  |  |              |  |  | (222,668    | ) |  |            |   |  |            |   |  | (222,668   | )
|Issuance of stock pursuant to a mineral
      property agreement                 |  |                |  |  |             |  |  | 131,667    |  |  | 1             |  |  | 284,999     |   |  |            |   |  |            |   |  | 285,000    |  
|Fair value of stock options
      granted                                        |  |                |  |  |             |  |  |           |  |  |              |  |  | 3,229,195   |   |  |            |   |  |            |   |  | 3,229,195  |  
|Issuance of stock pursuant to the exercise of
      stock options                |  |                |  |  |             |  |  | 39,500     |  |  | 1             |  |  | 52,499      |   |  |            |   |  |            |   |  | 52,500     |  
|Unrealized loss on investment
      securities recognized as an impairment loss  |  |                |  |  |             |  |  |           |  |  |              |  |  |            |   |  | 437,712     |   |  |            |   |  | 437,712    |  
|Net
      loss for the year                                                      |  |                |  |  |             |  |  |           |  |  |              |  |  |            |   |  |            |   |  | (7,692,137  | ) |  | (7,692,137 | )
|Balance, June 30, 2006                                                           |  | 500,000         |  |  | 5            |  |  | 17,302,474 |  |  | 173           |  |  | 13,193,680  |   |  |            |   |  | (13,682,690 | ) |  | (488,832   | )

(The accompanying notes are an integral part of these financial
statements)

F-6

---

|CANYON COPPER CORP.                                       
|----------------------------------------------------------
|(An Exploration Stage Company)                            
|Statement of Stockholders Equity (Deficit)               
|From January 21, 2000 (Date of Inception) to June 30, 2011
|(Expressed in U.S. dollars)                               

|                                                                |  |                 |  |  |              |  |  |            |  |  |             |  |  |            |  |  | Deficit     |   |  |            |  
|--------------------------------------------------------------- |  | --------------- |  |  | ------------ |  |  | ---------- |  |  | ----------- |  |  | ---------- |  |  | ----------- | - |  | ---------- | -
|                                                                |  |                 |  |  |              |  |  |            |  |  |             |  |  |            |  |  | Accumulated |   |  |            |  
|                                                                |  |                 |  |  |              |  |  |            |  |  |             |  |  | Additional |  |  | During the  |   |  |            |  
|                                                                |  | Preferred Stock |  |  | Common Stock |  |  | Paid-in    |  |  | Exploration |  |  |            | 
|                                                                |  | Shares          |  |  | Amount       |  |  | Shares     |  |  | Amount      |  |  | Capital    |  |  | Stage       |   |  | Total      |  
|                                                                |  | #               |  |  | $            |  |  | #          |  |  | $           |  |  | $          |  |  | $           |   |  | $          |  
|Balance, June 30, 2006                                          |  | 500,000         |  |  | 5            |  |  | 17,302,474 |  |  | 173         |  |  | 13,193,680 |  |  | (13,682,690 | ) |  | (488,832   | )
|Issuance of stock for cash at $0.9494 per
      share           |  |                |  |  |             |  |  | 683,613    |  |  | 7           |  |  | 648,993    |  |  |            |   |  | 649,000    |  
|Issuance of stock for cash at
      $1.1392 per share           |  |                |  |  |             |  |  | 43,889     |  |  | 1           |  |  | 49,999     |  |  |            |   |  | 50,000     |  
|Issuance of shares pursuant to mineral
      property agreement |  |                |  |  |             |  |  | 135,617    |  |  | 1           |  |  | 172,949    |  |  |            |   |  | 172,950    |  
|Issuance of shares to settle
      debt                         |  |                |  |  |             |  |  | 105,333    |  |  | 1           |  |  | 99,999     |  |  |            |   |  | 100,000    |  
|Issuance of shares to settle related party
      debt           |  |                |  |  |             |  |  | 5,583      |  |  |            |  |  | 5,300      |  |  |            |   |  | 5,300      |  
|Issuance of shares to settle
      convertible debentures       |  |                |  |  |             |  |  | 362,593    |  |  | 4           |  |  | 344,230    |  |  |            |   |  | 344,234    |  
|Intrinsic value of beneficial conversion
      features         |  |                |  |  |             |  |  |           |  |  |            |  |  | 254,749    |  |  |            |   |  | 254,749    |  
|Net loss for the year                                           |  |                |  |  |             |  |  |           |  |  |            |  |  |           |  |  | (2,177,278  | ) |  | (2,177,278 | )
|Balance, June 30, 2007                                          |  | 500,000         |  |  | 5            |  |  | 18,639,102 |  |  | 187         |  |  | 14,769,899 |  |  | (15,859,968 | ) |  | (1,089,877 | )
|Issuance of stock for cash at
      $0.9494 per share           |  |                |  |  |             |  |  | 316,000    |  |  | 3           |  |  | 299,997    |  |  |            |   |  | 300,000    |  
|Fair value of stock options granted                             |  |                |  |  |             |  |  |           |  |  |            |  |  | 578,932    |  |  |            |   |  | 578,932    |  
|Net loss for the year                                           |  |                |  |  |             |  |  |           |  |  |            |  |  |           |  |  | (1,216,504  | ) |  | (1,216,504 | )
|Balance, June 30, 2008                                          |  | 500,000         |  |  | 5            |  |  | 18,955,102 |  |  | 190         |  |  | 15,648,828 |  |  | (17,076,472 | ) |  | (1,427,449 | )

(The accompanying notes are an integral part of these financial
statements)

F-7

---

|CANYON COPPER CORP.                                       
|----------------------------------------------------------
|(An Exploration Stage Company)                            
|Statement of Stockholders Equity (Deficit)               
|From January 21, 2000 (Date of Inception) to June 30, 2011
|(Expressed in U.S. dollars)                               

|                                                                               |  |                 |  |  |              |  |  |            |  |  |        |  |  |               |   |  |             |  |  |            |   |  | Deficit     |   |  |            |  
|------------------------------------------------------------------------------ |  | --------------- |  |  | ------------ |  |  | ---------- |  |  | ------ |  |  | ------------- | - |  | ----------- |  |  | ---------- | - |  | ----------- | - |  | ---------- | -
|                                                                               |  |                 |  |  |              |  |  |            |  |  |        |  |  |               |   |  |             |  |  |            |   |  | Accumulated |   |  |            |  
|                                                                               |  |                 |  |  |              |  |  |            |  |  |        |  |  | Additional    |   |  | Common      |  |  | Stock      |   |  | During the  |   |  |            |  
|                                                                               |  | Preferred Stock |  |  | Common Stock |  |  | Paid-in    |  |  | Stock  |  |  | Subscriptions |   |  | Exploration |  |  |            |  
|                                                                               |  | Shares          |  |  | Amount       |  |  | Shares     |  |  | Amount |  |  | Capital       |   |  | Subscribed  |  |  | Receivable |   |  | Stage       |   |  | Total      |  
|                                                                               |  | #               |  |  | $            |  |  | #          |  |  | $      |  |  | $             |   |  | $           |  |  | $          |   |  | $           |   |  | $          |  
|                                                                               |  |                 |  |  |              |  |  |            |  |  |        |  |  |               |   |  |             |  |  |            |   |  |             |   |  |            |  
|Balance, June 30, 2008                                                         |  | 500,000         |  |  | 5            |  |  | 18,955,102 |  |  | 190    |  |  | 15,648,828    |   |  |            |  |  |           |   |  | (17,076,472 | ) |  | (1,427,449 | )
|Issuance of stock for cash at $0.38 per share                                  |  |                |  |  |             |  |  | 1,290,333  |  |  | 13     |  |  | 489,987       |   |  |            |  |  |           |   |  |            |   |  | 490,000    |  
|Issuance of stock for cash at
      $0.047 per share                           |  |                |  |  |             |  |  | 14,931,000 |  |  | 149    |  |  | 755,851       |   |  |            |  |  | (56,000    | ) |  |            |   |  | 700,000    |  
|Share issuance costs                                                           |  |                |  |  |             |  |  |           |  |  |       |  |  | (2,767        | ) |  |            |  |  |           |   |  |            |   |  | (2,767     | )
|Issuance of shares to settle
      convertible debentures                      |  |                |  |  |             |  |  | 15,513,978 |  |  | 155    |  |  | 2,980,208     |   |  |            |  |  |           |   |  |            |   |  | 2,980,363  |  
|Net
      loss for the year                                                    |  |                |  |  |             |  |  |           |  |  |       |  |  |              |   |  |            |  |  |           |   |  | (2,851,743  | ) |  | (2,851,743 | )
|Balance, June 30, 2009                                                         |  | 500,000         |  |  | 5            |  |  | 50,690,413 |  |  | 507    |  |  | 19,872,107    |   |  |            |  |  | (56,000    | ) |  | (19,928,215 | ) |  | (111,596   | )
|Issuance of stock for cash at $0.051 per
      share                           |  |                |  |  |             |  |  | 11,237,750 |  |  | 112    |  |  | 568,888       |   |  |            |  |  |           |   |  |            |   |  | 569,000    |  
|Fair value of stock options
      granted                                      |  |                |  |  |             |  |  |           |  |  |       |  |  | 362,614       |   |  |            |  |  |           |   |  |            |   |  | 362,614    |  
|Share subscriptions received                                                   |  |                |  |  |             |  |  |           |  |  |       |  |  |              |   |  |            |  |  | 56,000     |   |  |            |   |  | 56,000     |  
|Net loss for the year                                                          |  |                |  |  |             |  |  |           |  |  |       |  |  |              |   |  |            |  |  |           |   |  | (1,057,272  | ) |  | (1,057,272 | )
|Balance, June 30, 2010                                                         |  | 500,000         |  |  | 5            |  |  | 61,928,163 |  |  | 619    |  |  | 20,803,609    |   |  |            |  |  |           |   |  | (20,985,487 | ) |  | (181,254   | )
|Rounding due to stock split                                                    |  |                |  |  |             |  |  | 243        |  |  |       |  |  |              |   |  |            |  |  |           |   |  |            |   |  |           |  
|Issuance of stock for cash at Cdn$0.35 per
      unit                          |  |                |  |  |             |  |  | 3,447,315  |  |  | 35     |  |  | 1,258,572     |   |  |            |  |  |           |   |  |            |   |  | 1,258,607  |  
|Fair value of share purchase
      warrants recorded as derivative liabilities |  |                |  |  |             |  |  |           |  |  |       |  |  | (396,850      | ) |  |            |  |  |           |   |  |            |   |  | (396,850   | )
|Share issuance costs                                                           |  |                |  |  |             |  |  |           |  |  |       |  |  | (44,477       | ) |  |            |  |  |           |   |  |            |   |  | (44,477    | )
|Share subscriptions received                                                   |  |                |  |  |             |  |  |           |  |  |       |  |  |              |   |  | 300,000     |  |  |           |   |  |            |   |  | 300,000    |  
|Net
      loss for the year                                                    |  |                |  |  |             |  |  |           |  |  |       |  |  |              |   |  |            |  |  |           |   |  | (852,281    | ) |  | (852,281   | )
|Balance, June 30, 2011                                                         |  | 500,000         |  |  | 5            |  |  | 65,375,721 |  |  | 654    |  |  | 21,620,854    |   |  | 300,000     |  |  |           |   |  | (21,837,768 | ) |  | 83,745     |  

(The accompanying notes are an integral part of these financial
statements)

F-8

---

|CANYON COPPER CORP.          
|-----------------------------
|An Exploration Stage Company)
|Statements of Cash Flows     
|(Expressed in U.S. dollars)  

|                                                                                  |  |            |   |  |                     |   |  | Accumulated from |  
|--------------------------------------------------------------------------------- |  | ---------- | - |  | ------------------- | - |  | ---------------- | -
|                                                                                  |  |            |   |  |                     |   |  | January 21, 2000 |  
|                                                                                  |  | Year Ended |   |  | (date of inception) |  
|                                                                                  |  | June 30,   |   |  | to June 30,         |  
|                                                                                  |  | 2011       |   |  | 2010                |   |  | 2011             |  
|                                                                                  |  | $          |   |  | $                   |   |  | $                |  
|                                                                                  |  |            |   |  |                     |   |  |                  |  
|Operating Activities                                                              |  |            |   |  |                     |   |  |                  |  
|Net loss                                                                          |  | (852,281   | ) |  | (1,057,272          | ) |  | (21,837,768      | )
|Adjustments to reconcile net
      loss to net cash used in operating activities: |  |            |   |  |                     |   |  |                  |  
|Accretion of discounts on
      convertible debt                                  |  |           |   |  |                    |   |  | 799,963          |  
|Amortization of deferred financing costs                                          |  |           |   |  |                    |   |  | 27,475           |  
|Bad debts                                                                         |  |           |   |  |                    |   |  | 3,000            |  
|Depreciation                                                                      |  |           |   |  |                    |   |  | 5,540            |  
|Foreign exchange
      translation loss on debt                                   |  | 5,929      |   |  |                    |   |  | (26,266          | )
|Gain on
      change in fair value of derivative liabilities                      |  | (7,024     | ) |  |                    |   |  | (439,739         | )
|Gain on recovery of
      accounts payable                                        |  |           |   |  |                    |   |  | (3,020           | )
|Impairment of investment securities                                               |  |           |   |  |                    |   |  | 564,223          |  
|Impairment of mineral
      property costs                                        |  |           |   |  |                    |   |  | 2,747,630        |  
|Impairment of property and equipment                                              |  |           |   |  |                    |   |  | 10,811           |  
|Loss on conversion of
      debt                                                  |  |           |   |  |                    |   |  | 2,010,076        |  
|Loss on
      extinguishment of debt                                              |  |           |   |  |                    |   |  | 252,454          |  
|Loss on sale of
      investment securities                                       |  |           |   |  |                    |   |  | 411,430          |  
|Loss on
      settlement of related party debt                                    |  |           |   |  |                    |   |  | 2,871            |  
|Stock-based compensation                                                          |  |           |   |  | 362,614             |   |  | 4,872,104        |  
|Changes in operating assets
      and liabilities:                                |  |            |   |  |                     |   |  |                  |  
|Amount receivable                                                                 |  |           |   |  |                    |   |  | (3,000           | )
|Prepaid expenses
      and deposits                                               |  | (40,340    | ) |  | (2,571              | ) |  | (43,691          | )
|Accounts payable and accrued
      liabilities                                    |  | 43,894     |   |  | (137,216            | ) |  | 433,910          |  
|Due to related parties                                                            |  | 171,063    |   |  | 124,758             |   |  | 649,439          |  
|Net Cash Used in
      Operating Activities                                       |  | (678,759   | ) |  | (709,687            | ) |  | (9,562,558       | )
|Investing Activities                                                              |  |            |   |  |                     |   |  |                  |  
|Proceeds received on sale of investment
      securities                          |  |           |   |  |                    |   |  | 432,060          |  
|Acquisition of mineral
      properties                                           |  |           |   |  |                    |   |  | (413,138         | )
|Purchase of property and equipment                                                |  |           |   |  |                    |   |  | (16,351          | )
|Net Cash Provided by Investing Activities                                         |  |           |   |  |                    |   |  | 2,571            |  
|Financing Activities                                                              |  |            |   |  |                     |   |  |                  |  
|Advances from related
      parties                                               |  | 199,640    |   |  |                    |   |  | 346,659          |  
|Proceeds from issuance of notes and
      loans payable                           |  |           |   |  |                    |   |  | 448,363          |  
|Proceeds from issuance
      of convertible debentures                            |  |           |   |  |                    |   |  | 1,684,655        |  
|Repayment of notes payable                                                        |  |           |   |  | (89,511             | ) |  | (319,792         | )
|Repayment of
      convertible debentures                                         |  |           |   |  |                    |   |  | (149,092         | )
|Debt financing costs                                                              |  |           |   |  |                    |   |  | (250,143         | )
|Deferred financing
      costs                                                    |  | (60,965    | ) |  |                    |   |  | (60,965          | )
|Proceeds from share subscriptions
      and issuance of common stock              |  | 1,558,607  |   |  | 625,000             |   |  | 9,131,743        |  
|Stock issuance costs                                                              |  | (44,477    | ) |  |                    |   |  | (44,477          | )
|Net Cash Provided
      by Financing Activities                                   |  | 1,652,805  |   |  | 535,489             |   |  | 10,786,951       |  
|Increase (Decrease) in Cash                                                       |  | 974,046    |   |  | (174,198            | ) |  | 1,226,964        |  
|Cash, Beginning of
      Period                                                   |  | 252,918    |   |  | 427,116             |   |  |                 |  
|Cash, End of Period                                                               |  | 1,226,964  |   |  | 252,918             |   |  | 1,226,964        |  

Supplementary Cash Flow Information (Note 12)

(The accompanying notes are an integral part of these financial
statements)

F-9

---

|CANYON COPPER CORP.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|June 30, 2011                    
|(Expressed in U.S. dollars)      

|1. | Nature of Operations and Continuance of
Business                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Canyon Copper Corp., (the Company), was incorporated in
      the State of Nevada, U.S.A. on January 21, 2000 under the name Aberdene
      Mines Limited. On August 7, 2006, the Company changed its name to Canyon
      Copper Corp. The Company is an exploration stage company, as defined by
      Financial Accounting Standards Board (FASB) Accounting Standards
      Codification (ASC) 915, Development Stage Entities. The Companys
      principal business plan is to acquire, explore and develop mineral
      properties and ultimately seek earnings by exploiting mineral
    claims.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | The Company has been in the exploration stage since its
      formation in January 2000 and has not yet realized any revenues from its
      planned operations. It is primarily engaged in the acquisition,
      exploration and development of mineral properties. Upon location of a
      commercial mineable reserve, the Company will actively prepare the site
      for extraction and enter a development stage. At present, management
      devotes most of its activities to raising sufficient funds to further
      explore and develop its mineral properties. Planned principal activities
      have not yet begun. The ability of the Company to emerge from the
      exploration stage with respect to any planned principal business activity
      is dependent upon its successful efforts to raise additional debt or
      equity financing and/or attain profitable mining operations. As at June
      30, 2011, the Company has not generated any revenue and has accumulated
      losses of $21,837,768 since inception. The Company also has significant
      mineral property acquisition and exploration commitments. There is no
      guarantee that the Company will be able to complete any of the above
      objectives. These factors raise substantial doubt regarding the Companys
      ability to continue as a going concern.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Managements plan for the next twelve months is to
      continue initial exploration activities on the New York Canyon Project in
      Nevada. The agreements pursuant to which the Company acquired its
      interests in the New York Canyon Project provide for a series of cash
      payments and annual filing maintenance costs. If the Company fails to make
      such payments or expenditures in a timely fashion, it may lose its
      interest in those properties. As at June 30, 2011, the Company had cash of
      $1,226,964 on hand, and for the next twelve months, management anticipates
      that the minimum cash requirements to fund its proposed exploration
      program and continued operations will be $1,090,000. Accordingly, the
      Company currently has sufficient funds to meet planned expenditures over
      the next twelve months. However, there is no assurance that the Company
      will be able to raise sufficient cash to fund its future exploration
      programs and operational expenditures.                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|2. | Summary of Significant Accounting Policies                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

F-10

---

|CANYON COPPER CORP.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|June 30, 2011                    
|(Expressed in U.S. dollars)      

|2. | Summary of Significant Accounting Policies
    (continued)
|-- | ----------------------------------------------------------
|   |                                                           
|   | (d)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   | (e)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (f)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (g)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (h)                                                       
|   |                                                           
|   |                                                           

F-11

---

|CANYON COPPER CORP.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|June 30, 2011                    
|(Expressed in U.S. dollars)      

|2. | Summary of Significant Accounting Policies
    (continued)
|-- | ----------------------------------------------------------
|   |                                                           
|   | (h)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   | (i)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (j)                                                       
|   |                                                           
|   |                                                           

Level 1

Level 1 applies to assets or
liabilities for which there are quoted prices in active markets for identical
assets or liabilities.

Level 2

Level 2 applies to assets or
liabilities for which there are inputs other than quoted prices that are
observable for the asset or liability such as quoted prices for similar assets
or liabilities in active markets; quoted prices for identical assets or
liabilities in markets with insufficient volume or infrequent transactions (less
active markets); or model-derived valuations in which significant inputs are
observable or can be derived principally from, or corroborated by, observable
market data.

Level 3

Level 3 applies to assets or
liabilities for which there are unobservable inputs to the valuation methodology
that are significant to the measurement of the fair value of the assets or
liabilities.

The Companys financial instruments
consist principally of cash, accounts payable, accrued liabilities, and amounts
due to related parties. Pursuant to ASC 820, the fair value of cash is
determined based on Level 1 inputs, which consist of quoted prices in active
markets for identical assets. The recorded values of all other financial
instruments approximate their current fair values because of their nature and
respective maturity dates or durations.

F-12

---

|CANYON COPPER CORP.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|June 30, 2011                    
|(Expressed in U.S. dollars)      

|2. | Summary of Significant Accounting Policies
    (continued)
|-- | ----------------------------------------------------------
|   |                                                           
|   | (k)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (l)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   | (m)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           
|   | (n)                                                       
|   |                                                           
|   |                                                           
|   |                                                           
|   |                                                           

F-13

---

|CANYON COPPER CORP.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|June 30, 2011                    
|(Expressed in U.S. dollars)      

|3. | Mineral Properties        
|-- | --------------------------
|   |                           
|   | (a)                       
|   |                           
|   |                           
|   |                           
|   |                           
|   |                           
|   | (b)                       
|   |                           
|   | (c)                       
|   |                           
|4. | Related Party Transactions
|   |                           
|   | (a)                       
|   |                           
|   | (b)                       
|   |                           
|   |                           
|   |                           
|   |                           
|   |                           
|   |                           
|   |                           
|   |                           

F-14

---

|CANYON COPPER CORP.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|June 30, 2011                    
|(Expressed in U.S. dollars)      

|4. | Related Party Transactions
(continued)
|-- | --------------------------------------

| | (c) | As at June 30, 2011, the Company was indebted to the
      Chief Financial Officer of the Company for $nil (2010 - $292 (Cdn$310)),
      which is non-interest bearing, unsecured and due on demand;                                                                                                
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                      
| | (d) | During the year ended June 30, 2011, the Company incurred
      management fees of $60,497 (2010 - $60,505), $60,497 (2010 - $56,898), and
      $74,173 (2010 - $69,300) to the Chief Executive Officer of the Company,
      President of the Company, and Chief Financial Officer,
  respectively.
| |     |                                                                                                                                                                                                                                                                                                      
| | (e) | During the year ended June 30, 2011, the Company incurred
      geological support fees of $nil (2010 - $20,000), office and general
      expenses of $nil (2010 - $20,000), and rent of $17,957 (2010 - $16,956) to
      a company with common directors and officers.                            
| |     |                                                                                                                                                                                                                                                                                                      
| | (f) | As at June 30, 2011, $nil (2010 - $7,071 (Cdn$7,500)) is
      owed to a company with common directors and officers and is included in
      accounts payable. The amount due is non-interest bearing, unsecured and
      due on demand.                                                            

|5. | Derivative Liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | The Company has share purchase warrants that were issued
      in private placements which have exercise prices denominated in Canadian
      dollars which differs from the Companys functional currency (U.S.
      dollars). As a result, these share purchase warrants cannot be considered
      to be indexed to the Companys own stock and accordingly must be accounted
      for as derivative liabilities with changes in fair value recorded in the
      statement of operations.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | The fair value of the derivative liability for the
      1,674,730 share purchase warrants exercisable at Cdn$0.50 per share issued
      on May 11, 2011 was $385,694. The fair value of the derivative liability
      for the 48,928 share purchase warrants exercisable at Cdn$0.50 per share
      issued on June 8, 2011 was $11,156.                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | The fair values of these share purchase warrants as at
      June 30, 2011 and 2010 are as follows:                                                                                                                                                                                                                                                                                                                                                                                            

| |                                                        |  | 2011    |  |  | 2010 | 
| | ------------------------------------------------------ |  | ------- |  |  | ---- | 
| |                                                        |  | $       |  |  | $    | 
| |                                                        |  |         |  |  |      | 
| | 1,674,730 warrants expiring on November 10,
      2012 |  | 378,707 |  |  |     | 
| | 48,928 warrants
      expiring on December 7, 2012     |  | 11,119  |  |  |     | 
| |                                                        |  |         |  |  |      | 
| |                                                        |  | 389,826 |  |  |     | 

During the year ended June 30, 2011,
the Company recorded a gain on the change in fair value of the derivative
liabilities of $7,024 equal to the difference in the fair value of the
derivative liabilities at the issuance dates and June 30, 2011.

The Company uses the Black-Scholes
option pricing model to calculate the fair values of the derivative liabilities.
The following table shows the weighted average assumptions used in the
calculations:

| |                                                        |  |            |  |  | Risk-free |  |  | Expected |  |  | Expected | 
| | ------------------------------------------------------ |  | ---------- |  |  | --------- |  |  | -------- |  |  | -------- | 
| |                                                        |  | Expected   |  |  | Interest  |  |  | Dividend |  |  | Life (in | 
| |                                                        |  | Volatility |  |  | Rate      |  |  | Yield    |  |  | years)   | 
| |                                                        |  |            |  |  |           |  |  |          |  |  |          | 
| | As at issuance date:                                   |  |            |  |  |           |  |  |          |  |  |          | 
| |                                                        |  |            |  |  |           |  |  |          |  |  |          | 
| | 1,674,730 warrants expiring on
      November 10, 2012 |  | 175%       |  |  | 0.37%     |  |  | 0%       |  |  | 1.5      | 
| | 48,930 warrants expiring on December 7, 2012           |  | 172%       |  |  | 0.29%     |  |  | 0%       |  |  | 1.5      | 
| |                                                        |  |            |  |  |           |  |  |          |  |  |          | 
| | As at June 30,
      2011                              |  | 180%       |  |  | 0.32%     |  |  | 0%       |  |  | 1.4      | 

|6. | Common Stock                                            
|-- | --------------------------------------------------------
|   |                                                         
|   | Stock transactions for the year ended June 30,
    2011:
|   |                                                         
|   | (a)                                                     

F-15

---

|CANYON COPPER CORP.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|June 30, 2011                    
|(Expressed in U.S. dollars)      

|6. | Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | Stock transactions for the year ended June 30, 2011
      (continued):                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | (d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | Stock transactions for the year ended June 30,
    2010:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | (c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|7. | Stock Options                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On August 21, 2009 (as amended), the Board of Directors
      of the Company adopted the Companys 2009 Stock Option Plan (the 2009
      Plan). The aggregate number of shares of the Companys common stock
      available for issuance under the 2009 Plan is 10% of the Companys issued
      and outstanding shares. As at June 30, 2011, the Company had 2,989,150
      stock options available for granting pursuant to the 2009 Plan.                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | On August 21, 2009, the Company issued non-qualified
      stock options to purchase a total of 3,239,000 shares of common stock to
      various employees, officers, directors and consultants of the Company, of
      which 3,120,500 stock options were issued pursuant to the 2009 Plan. The
      options were granted with an exercise price of $0.13 per share and expire
      on August 20, 2014. The fair value of these stock options was estimated at
      the date of grant using the Black-Scholes option-pricing model assuming an
      expected life of 5 years, a risk-free rate of 2.58%, an expected
      volatility of 213%, and a 0% dividend yield. The weighted average fair
      value of stock options granted was $0.09 per option.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | During the year ended June 30, 2011, the Company recorded
      stock-based compensation of $nil (2010 - $362,614) as general and
      administrative expense.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | A summary of the Companys stock option activity is as
      follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

| |                                           |  |           |   |  | Weighted       |  |  | Aggregate | 
| | ----------------------------------------- |  | --------- | - |  | -------------- |  |  | --------- | 
| |                                           |  |           |   |  | Average        |  |  | Intrinsic | 
| |                                           |  | Number of |   |  | Exercise Price |  |  | Value     | 
| |                                           |  | Options   |   |  | $              |  |  | $         | 
| |                                           |  |           |   |  |                |  |  |           | 
| | Outstanding, June 30, 2009                |  | 941,416   |   |  | 0.97           |  |  |           | 
| |                                           |  |           |   |  |                |  |  |           | 
| | Granted                                   |  | 3,239,000 |   |  | 0.13           |  |  |           | 
| | Expired                                   |  | (631,999  | ) |  | 0.58           |  |  |           | 
| |                                           |  |           |   |  |                |  |  |           | 
| | Outstanding, June
      30, 2010 and 2011 |  | 3,548,417 |   |  | 0.27           |  |  | 712,580   | 

As at June 30, 2011, the weighted
average remaining contractual life of the outstanding stock options is 2.84
years.

F-16

---

|CANYON COPPER CORP.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|June 30, 2011                    
|(Expressed in U.S. dollars)      

|8. | Share Purchase Warrants                                                                      
|-- | ---------------------------------------------------------------------------------------------
|   |                                                                                              
|   | The following table summarizes the continuity of the
      Companys share purchase warrants:

| |                              |  |            |   |  | Weighted | 
| | ---------------------------- |  | ---------- | - |  | -------- | 
| |                              |  |            |   |  | Average  | 
| |                              |  |            |   |  | Exercise | 
| |                              |  | Number of  |   |  | Price    | 
| |                              |  | Warrants   |   |  | $        | 
| |                              |  |            |   |  |          | 
| | Balance, June 30, 2009       |  | 9,363,321  |   |  | 0.16     | 
| |                              |  |            |   |  |          | 
| | Expired                      |  | (316,000   | ) |  | 1.14     | 
| |                              |  |            |   |  |          | 
| | Balance, June 30, 2010       |  | 9,047,321  |   |  | 0.13     | 
| |                              |  |            |   |  |          | 
| | Issued                       |  | 1,723,658  |   |  | 0.52     | 
| | Expired                      |  | (9,047,321 | ) |  | 0.13     | 
| |                              |  |            |   |  |          | 
| | Balance, June 30,
      2011 |  | 1,723,658  |   |  | 0.52     | 

As at June 30, 2011, the following
share purchase warrants were outstanding:

| | Number of | Exercise |                  
| | --------- | -------- | -----------------
| | Warrants  | Price    | Expiry
      Date
| |           |          |                  
| | 1,674,730 | Cdn$0.50 | November 10, 2012
| | 48,928    | Cdn$0.50 | December 7, 2012 
| |           |          |                  
| | 1,723,658 |          |                  

|9.  | Contingent Liability                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    | On January 23, 2007, Focused Investor Relations Marketing
      Inc. commenced an action in Ontario, Canada against the Company seeking
      payment in the amount of $84,000 pursuant to an oral agreement. The
      Company believes that this action is without merit and will defend its
      position vigorously.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|10. | Commitment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    | On January 26, 2011, the Company entered into an
      agreement whereby an agent will try and secure a private placement
      offering of 4,285,714 units at a price of Cdn$0.35 (offering price) per
      unit for gross proceeds of up to Cdn$1,500,000 (brokered offering). Each
      unit will consist of one share of common stock and one-half share purchase
      warrant with each whole share purchase warrant exercisable at Cdn$0.50 per
      share for a period of eighteen months. The Company has agreed to grant the
      agent an over-allotment option to purchase up to 2,857,142 units at the
      offering price for gross proceeds of Cdn$1,000,000 within ten business
      days of the closing of the brokered offering. The agent will receive a
      cash commission equal to 6% of the gross proceeds of the brokered offering
      and a non-transferable option entitling the agent to purchase up to 6% of
      the units sold under the brokered offering and the over-allotment option
      at the offering price for a period of eighteen months from the date the
      Company gets listed on the TSX Venture Exchange. Upon execution of the
      agreement, the Company is to pay the agent a non-refundable fee of
      Cdn$11,200 which will be credited against the agents legal costs on
      closing. The agent has also agreed to act as the sponsor in support of the
      Companys listing on the TSX Venture Exchange. The Company will pay the
      agent a sponsorship fee of Cdn$20,000 and reimburse the agent for legal
      (capped at Cdn$25,000), due diligence (Cdn$5,000) and out-of-pocket
      expenses. The Company has paid a non- refundable payment of $36,300
      (Cdn$35,000) which has been recorded as deferred financing costs as at
      June 30, 2011. Refer to Note 13.

F-17

---

|CANYON COPPER CORP.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|June 30, 2011                    
|(Expressed in U.S. dollars)      

|11. | Income Taxes                                                                                                                                                                                                                                                                                        
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                     
|    | The Company has net operating losses carried forward of
      $6,938,388 available to offset taxable income in future years which expire
      beginning in fiscal 2020.                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                     
|    | The Company is subject to United States federal and state
      income taxes at an approximate rate of 35%. The reconciliation of the
      provision for income taxes at the United States federal statutory rate
      compared to the Companys income tax expense as reported is as
    follows:

| |                                                             |  | 2011     |   |  | 2010       |  
| | ----------------------------------------------------------- |  | -------- | - |  | ---------- | -
| |                                                             |  | $        |   |  | $          |  
| | Net loss before income taxes per financial
      statements |  | (852,281 | ) |  | (1,057,272 | )
| | Income tax rate                                             |  | 35%      |   |  | 35%        |  
| | Income tax recovery                                         |  | 298,298  |   |  | 370,045    |  
| | Permanent differences and other                             |  | 2,459    |   |  | (126,914   | )
| | Change in valuation allowance                               |  | (300,757 | ) |  | (243,131   | )
| | Provision for
      income taxes                            |  |         |   |  |           |  

The significant components of deferred
income tax assets and liabilities at June 30, 2011 and 2010 are as follows:

| |                                      |  | 2011       |   |  | 2010       |  
| | ------------------------------------ |  | ---------- | - |  | ---------- | -
| |                                      |  | $          |   |  | $          |  
| |                                      |  |            |   |  |            |  
| | Mineral property costs               |  | 2,831,499  |   |  | 2,689,611  |  
| | Net operating losses carried forward |  | 2,429,068  |   |  | 2,270,199  |  
| | Valuation allowance                  |  | (5,260,567 | ) |  | (4,959,810 | )
| |                                      |  |            |   |  |            |  
| | Net deferred income tax asset        |  |           |   |  |           |  

As at June 30, 2011, the Company is in
arrears on filing its statutory corporate income tax returns and the amounts
presented above are based on estimates. The actual losses available could differ
from these estimates.

|12. | Supplemental Cash Flow
Information
|--- | ----------------------------------

| |                                                                                           |  |            |  |  |        |  |  | Accumulated from    | 
| | ----------------------------------------------------------------------------------------- |  | ---------- |  |  | ------ |  |  | ------------------- | 
| |                                                                                           |  |            |  |  |        |  |  | January 21, 2000    | 
| |                                                                                           |  | Year Ended |  |  |        |  |  | (date of inception) | 
| |                                                                                           |  | June 30,   |  |  |        |  |  | to June 30,         | 
| |                                                                                           |  | 2011       |  |  | 2010   |  |  | 2011                | 
| |                                                                                           |  | $          |  |  | $      |  |  | $                   | 
| |                                                                                           |  |            |  |  |        |  |  |                     | 
| | Non-cash Investing and Financing
      Activities:                                        |  |            |  |  |        |  |  |                     | 
| |                                                                                           |  |            |  |  |        |  |  |                     | 
| | Preferred stock
      issued for investment securities                                    |  |           |  |  |       |  |  | 1,535,575           | 
| | Investment securities
      used to pay the finders fee for the preferred stock issuance |  |           |  |  |       |  |  | 153,557             | 
| | Common stock
      issued to settle debt                                                  |  |           |  |  |       |  |  | 3,528,100           | 
| | Common stock issued for mineral
      property lease                                      |  |           |  |  |       |  |  | 2,334,492           | 
| |                                                                                           |  |            |  |  |        |  |  |                     | 
| | Supplemental Disclosures:                                                                 |  |            |  |  |        |  |  |                     | 
| |                                                                                           |  |            |  |  |        |  |  |                     | 
| | Interest paid                                                                             |  |           |  |  | 26,729 |  |  | 98,850              | 
| | Income taxes paid                                                                         |  |           |  |  |       |  |  |                    | 

F-18

---

|CANYON COPPER CORP.              
|---------------------------------
|(An Exploration Stage Company)   
|Notes to the Financial Statements
|June 30, 2011                    
|(Expressed in U.S. dollars)      

|13. | Subsequent Event                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | On July 12, 2011, the Company issued 2,164,071 units at
      Cdn$0.35 per unit for proceeds of Cdn$757,425 pursuant to a brokered
      private placement and issued 857,142 units at Cdn$0.35 per unit for
      proceeds of Cdn$300,000 pursuant to a non-brokered private placement. Each
      unit consists of one share of common stock and one-half of one share
      purchase warrant, with each whole share purchase warrant entitling the
      holder to purchase an additional share of the common stock at a price of
      Cdn$0.50 per share until January 13, 2013. Subject to the terms and
      conditions of the warrants, the Company may accelerate the expiry date of
      the warrants if the Companys shares close at a price equal to or greater
      than Cdn$0.60 for ten consecutive trading days. If the Company elects to
      exercise its accelerated expiry date, the accelerated expiry date will be
      thirty days after the Company sends out the notice of acceleration. In
      connection with this private placement, the Agent was paid Cdn$45,445 and
      issued 129,844 units at Cdn$0.35 per unit on the same terms of the private
      placement.

F-19

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ITEM 9.
    CHANGES IN AND DISAGREEMENTS WITH
      ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
      DISCLOSURE.


Dismissal of Independent Registered Public Accounting
Firm

On August 24, 2010, we dismissed Manning Elliott LLP (the
Former Auditor), as our independent public accountants. Our Board of Directors
and Audit Committee approved the dismissal of the Former Auditor.

The Former Auditors reports on our financial statements for
the years ended June 30, 2009 and 2008 did not contain an adverse opinion or
disclaimer of opinion, nor were they modified or qualified as to uncertainty,
audit scope or accounting principles with the exception of a statement regarding
the uncertainty of our ability to continue as a going concern.

There have been no disagreements during the fiscal years ended
June 30, 2009 and 2008 and the subsequent interim period up to and including the
date of dismissal between us and the Former Auditor on any matter of accounting
principles or practices, financial statement disclosure or auditing scope or
procedure, which, if not resolved to the satisfaction of the Former Auditor,
would have caused them to make reference to the subject matter of the
disagreement in connection with the Former Auditors report for the financial
statements for the past year and any subsequent interim period up to and
including to the date of the Former Auditors dismissal.

Appointment of Independent Registered Public Accounting
Firm

On August 24, 2010, we appointed Saturna Group Chartered
Accountants LLP ("Saturna") as our new independent registered public accounting
firm. Our Board of Directors and Audit Committee approved the engagement of
Saturna.

We did not consult with Saturna during the fiscal years ended
June 30, 2009 and 2008 and any subsequent interim period prior to their
engagement regarding: (i) the application of accounting principles to a specific
completed or proposed transaction or the type of audit opinion that might be
rendered on our financial statements, and either a written report was provided
to us or advice was provided that the newly appointed accountant concluded was
an important factor in reaching a decision as to the accounting, auditing or
financial reporting issue; or (ii) any matter that was either the subject of a
disagreement or a reportable event in response to paragraph (a)(1)(iv) of Item
304 of Regulation S-K, promulgated under the Exchange Act.

|ITEM 9AT. | CONTROLS AND PROCEDURES.
|--------- | ------------------------

Disclosure Controls and Procedures

We carried out an evaluation of the effectiveness of our
disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)
and 15d-15(e)) as of June 30, 2011 (the Evaluation Date). This evaluation was
carried out under the supervision and with the participation of our Chief
Executive Officer and Chief Financial Officer. Based upon that evaluation, our
Chief Executive Officer and Chief Financial Officer concluded that our
disclosure controls and procedures were not effective as of the Evaluation Date
as a result of the material weaknesses in internal control over financial
reporting discussed below.

Disclosure controls and procedures are those controls and
procedures that are designed to ensure that information required to be disclosed
in our reports filed or submitted under the Exchange Act are recorded,
processed, summarized and reported within the time periods specified in the
SEC's rules and forms. Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information required
to be disclosed in our reports filed under the Exchange Act is accumulated and
communicated to management, including our Chief Executive Officer and Chief
Financial Officer, to allow timely decisions regarding required disclosure.

Notwithstanding the assessment that our internal control over
financial reporting was not effective and that there were material weaknesses as
identified in this report, we believe that our financial statements contained in
our Annual Report on Form 10-K for the year ended June 30, 2011 fairly present
our financial condition, results of operations and cash flows in all material
respects.

27

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Management's Annual Report on Internal Control Over
Financial Reporting

Our management is responsible for establishing and maintaining
adequate internal control over financial reporting, as such term is defined in
Rules 13a-15(f) and 15d-15(f) under the Exchange Act, for the Company.

Internal control over financial reporting includes those
policies and procedures that: (1) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions and
dispositions of our assets; (2) provide reasonable assurance that transactions
are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that our receipts
and expenditures are being made only in accordance with authorizations of its
management and directors; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use or disposition
of our assets that could have a material effect on the financial statements.

Management recognizes that there are inherent limitations in
the effectiveness of any system of internal control, and accordingly, even
effective internal control can provide only reasonable assurance with respect to
financial statement preparation and may not prevent or detect material
misstatements. In addition, effective internal control at a point in time may
become ineffective in future periods because of changes in conditions or due to
deterioration in the degree of compliance with our established policies and
procedures.

A material weakness is a significant deficiency, or combination
of significant deficiencies, that results in there being a more than remote
likelihood that a material misstatement of the annual or interim financial
statements will not be prevented or detected.

Under the supervision and with the participation of our Chief
Executive Officer and Chief Financial Officer, management conducted an
evaluation of the effectiveness of our internal control over financial
reporting, as of the Evaluation Date, based on the framework set forth in
Internal Control-Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Based on its evaluation under
this framework, management concluded that our internal control over financial
reporting was not effective as of the Evaluation Date.

Management assessed the effectiveness of the Companys internal
control over financial reporting as of Evaluation Date and identified the
following material weaknesses:

Inadequate Segregation of Duties: We have an inadequate
number of personnel to properly implement control procedures.

Insufficient Written Policies & Procedures:We have
insufficient written policies and procedures for accounting and financial
reporting.

Inadequate Financial Statement Closing Process:We have
an inadequate financial statement closing process.

Lack of Audit Committee Financial Expert:Our audit
committee has deficiencies due to the fact that it does not have an audit
committee financial expert.

Management is committed to improving its internal controls and
will (1) continue to use third party specialists to address shortfalls in
staffing and to assist the Company with accounting and finance responsibilities,
(2) increase the frequency of independent reconciliations of significant
accounts which will mitigate the lack of segregation of duties until there are
sufficient personnel and (3) prepare and implement sufficient written policies
and checklists for financial reporting and closing processes and (4) may
consider appointing outside directors and audit committee members in the
future.

Management, including our Chief Executive Officer and the Chief
Financial Officer, has discussed the material weakness noted above with our
independent registered public accounting firm. Due to the nature of this
material weakness, there is a more than remote likelihood that misstatements
which could be material to the annual or interim financial statements could
occur that would not be prevented or detected.

This annual report does not include an attestation report of
our registered public accounting firm regarding internal control over financial
reporting. Management's report was not subject to attestation by the our
registered public accounting firm pursuant to temporary rules of the SEC
that permit us to provide only management's report in this annual report.

28

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Changes in internal control over financial reporting

There were no changes in our internal control over financial
reporting that occurred during the fiscal year ended June 30, 2011 that have
materially affected, or that are reasonably likely to materially affect, our
internal control over financial reporting.

Limitations on the effectiveness of controls and
procedures

Our management, including our Chief Executive Officer and the
Chief Financial Officer, do not expect that the our controls and procedures will
prevent all potential errors or fraud. A control system, no matter how well
conceived and operated, can provide only reasonable, not absolute, assurance
that the objectives of the control system are met.

|ITEM 9B. | OTHER INFORMATION.
|-------- | ------------------

None.

29

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PART III

|ITEM 10. | DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE
      GOVERNANCE.
|-------- | -------------------------------------------------------------

Our executive officers and directors and their respective ages
and titles are as follows:

NAME OF DIRECTOR / OFFICER
    AGE
    POSITIONAnthony Harvey
    77
    Director, Chairman and Chief
      Executive OfficerBenjamin Ainsworth
    70
    Director, President And SecretaryKurt Bordian
    43
    Chief Financial Officer and
      TreasurerBryan Wilson
    61
    DirectorJames E. Yates
    69
    Director


Set forth below is a brief description of the background and
business experience of our executive officers and directors for the past five
years:

Anthony Harvey(Director, Chairman, and Chief Executive
Officer): On May 30, 2006, Mr. Anthony Harvey was appointed as our Chairman,
Chief Executive Officer and as a member of our Board of Directors. Mr. Anthony
Harvey has over 40 years of consulting experience on numerous mining projects
internationally with capital costs ranging up to and exceeding $400 million. Mr.
Harvey has spent 30 years working with Wright Engineers Ltd. Fluor Daniels in
various management positions, including Senior Project Manager, involved in the
design and construction of 14 mines world wide on behalf of major mining
corporations.

Mr. Harvey is presently the founder and board member of ARH
Management Limited, which has provided management and consulting services to the
resource industry. Mr. Harvey is also currently chairman and a director of ESO
Uranium Corp. (ESO-TSX.V), a uranium exploration company with properties located
in Saskatchewan and Northeastern Ontario.

Also, Mr. Harvey was a director of Terra Energy Inc.
(TTR-TSX.V) from August 2002 to May 2007, a petroleum and natural gas company
based in Calgary, Alberta. Mr. Harvey was a former founder, president and
chairman of Azco Mining Inc. (AZCO-TSX/AMEX) from 1988 to 2000, former founder,
chairman and director of Oremex Resources Inc. (ORM-TSX.V), and former chairman
and director of Lakeshore Gold Corp. (LSG-TSX).

Benjamin Ainsworth(Director, President and Secretary):
On May 30, 2006, Mr. Benjamin Ainsworth was appointed as our Secretary and a
member of our Board of Directors. Since November 7, 2007, Mr. Ainsworth has
served as our President.

Mr. Ainsworth is a senior geologist and mining consultant who
has been involved in the mining industry for over thirty-five years. Mr.
Ainsworth joined Placer Development in 1965 and held positions of Senior
Geologist, Chief Geochemist, Exploration Manager  Eastern Canada, Exploration
Manager  Chile, and President  Placer Chile, South America. Throughout the
1970s, Mr. Ainsworth was involved in the design, budgeting and implementation
of exploration programs that included large and small drill programs,
geophysical surveys, geological mapping, geochemical surveys, and a full range
of project evaluation studies.

Mr. Ainsworth is the principal, senior geologist and mining
consultant of Ainsworth Jenkins Holdings Inc. The consulting firm has been
responsible for concept, design and implementation of a number of exploration
projects. Mr. Ainsworth is a director of several public companies including
Black Panther Mining Corp. (BPC.TSX.V), ESO Uranium Corp. (ESO-TSX.V), Columbia
Yukon Explorations Inc. (CYU-TSX.V), Consolidated Venturex Holdings Ltd.
(CVA-TSX.V), Sultan Minerals Inc. (SUL-TSX.V), Hathor Exploration Ltd.
(HAT-TSX.V) and Dajin Resources Ltd. (DJI-TSX.V).

Kurt Bordian (Chief Financial Officer and Treasurer):
Mr. Kurt Bordian was appointed as our Chief Financial Officer on January 6, 2006
and as our Treasurer on November 7, 2007. Mr. Bordian is responsible for our
financial management functions. He has worked primarily in the mineral
exploration and oil and gas industries over the past 12 years.

30

---

Mr. Bordian currently serves as a director or officer on a
number mineral exploration and development companies, including: Chief Financial
Officer of ESO Uranium Corp. (ESO-TSX.V) since November 2006; director of Thor
Explorations Ltd. (THX-TSX.V); director of Calypso Uranium Corp. (CLP-TSX.V)
since April 2006 and former Chief Financial Officer from February 2006 to March
2007; and director of Palo Duro Energy Inc. (PDE-TSX.V) since August, 2006 and
former Chief Financial Officer from August, 2006 to September, 2006.

Previously, Mr. Bordian has served as a director or officer on
the following public companies: director of Legal Access Technologies Inc. from
November 2004 to January 2006 and Chief Financial Officer from November 2004 to
April 2005; Chief Financial Officer of Mexoro Minerals Ltd. from February 2007
to June 2007; director of Bordeaux Energy Inc. (BDO-TSX.V) from July 2006 to
June 2007 and Chief Financial Officer from July 2006 to September 2006; Chief
Financial Officer, Secretary and director of Black Tusk Minerals Inc.
(BKTK-OTCBB) from August 2005 to September 2008; Chief Financial Officer of Gold
Point Energy Corp. (GPE-TSX.V); and President, CEO and director of Magnate
Ventures Inc. (MGV.H-NEX) from May, 2007 to August 2009.

Mr. Bordian is a Certified General Accountant in Canada, and
holds a Bachelor of Commerce (Honors) Degree from the University of
Manitoba.

Bryan Wilson (Director): Bryan Wilson has served as a
member of our Board of Directors since March 6, 2006. Mr. Wilson also served as
our President and Treasurer from May 30, 2006 to November 7, 2007.

Mr. Wilson obtained a Bachelor of Science from the University
of Waterloo in 1975. He has worked in the fields of mining exploration and
development for 18 years and financial services for 12 years. He has filled
various roles such as a Mining Analyst for C.M. Oliver and Dominick &
Dominick Securities Inc. and as a Corporate Finance Specialist for Thames
Capital. Since September 2008, Mr. Wilson has served as Director, Exploration
Business Development of Centerra Gold (CG  TSX), a company engaged in the
acquisition, development and production of gold properties in Central Asia, the
former Soviet Union and emerging markets. Mr. Wilson is currently a director of
Doubleview Capital Corp. (DBV  TSXV), a company engaged in the exploration of
mineral properties in British Columbia. Mr. Wilson previously served as
President and CEO of Gee-Ten Ventures Inc. (GTV  TSX.V), a company engaged in
the exploration and development of mineral projects, from February 2008 to
September 2008 and as a director of Gee-Ten Ventures Inc. from February 2008 to
February 2010. Since September 1999, Mr. Wilson has acted as a director of
Spider Resources Inc. (SPQ-TSX.V), a junior exploration company, and was the CEO
and President of Spider Resources Inc. from June 2003 to June 2005.

In addition to the companies above, Mr. Wilson also acted as
CEO, President and Director of Vencan Gold Corp. (now known as Red Pine
Exploration Inc. (RPX  TSX.V)), an company engaged on the exploration of
various gold projects, from April 2003 to September 2005. Mr. Wilson also served
as President, CEO and director of St. Genevieve Resources Ltd. (SGVL-CNSX,
STGIF-OTCBB), a mining exploration and development company, from January 2003 to
March 2008.

James E. Yates (Director): Mr. Yates joined our Board of
Directors on April 15, 2009. Mr. Yates has over twenty years experience in the
mineral exploration industry and has served as a director and officer of several
public mining companies. From 1982 to 1988 he was the Founder, President and
Director of Hycroft Resources, which successfully brought the Crofoot Mine into
production. Mr. Yates has overseen the corporate management and financing of a
number of projects in North America including American Bullion Minerals, Zappa
Resources, and Jersey Goldfields, having raised in excess of $20 million for
mineral exploration development. Mr. Yates is currently a director of ESO
Uranium Corp. (ESO  TSX.V), a mineral exploration company focused on uranium
exploration, and Nevada Geothermal Power Inc. (NGP  TSX.V), a company engaged
in producing geothermal electrical power from geothermal resources in the United
States.

Term of Office

Our directors are appointed for a one-year term to hold office
until the next annual general meeting of our stockholders or until removed from
office in accordance with our bylaws. Our officers are appointed by our board of
directors and hold office until removed by the board.

31

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COMMITTEES OF THE BOARD OF DIRECTORS

Audit Committee

Our audit committee currently consists of Anthony Harvey, James
E. Yates and Bryan Wilson. Mr. Harvey is not an independent director as he
currently acts as our Chairman and Chief Executive Officer. Mr. Yates and Mr.
Wilson are independent members of our Board of Directors. See Item 13  Certain
Relationships and Related Transactions, and Director Independence.

Audit Committee Financial Expert

Our Board of Directors has determined that we do not presently
have a director who meets the definition of an audit committee financial
expert. We believe that the cost related to appointing a financial expert to
our Board of Directors at this time is prohibitive.

Disclosure Committee and Charter

We have a disclosure committee and disclosure committee
charter. The disclosure committee is comprised of all of our officers and
directors. The purpose of the committee is to provide assistance to the Chief
Executive Officer and the Chief Financial Officer in fulfilling their
responsibilities regarding the identification and disclosure of material
information about us, and the accuracy, completeness and timeliness of our
financial reports.

CODE OF ETHICS

We adopted a Code of Ethics applicable to our Chief Executive
Officer, Chief Financial Officer, Corporate Controller and certain other finance
executives, which is a "code of ethics" as defined by applicable rules of the
SEC. Our Code of Ethics was attached as an exhibit to our Annual Report on Form
10-KSB for the year ended June 30, 2003, filed with the SEC on August 26, 2003.
If we make any amendments to our Code of Ethics other than technical,
administrative, or other non-substantive amendments, or grant any waivers,
including implicit waivers, from a provision of our Code of Ethics to our chief
executive officer, chief financial officer, or certain other finance executives,
we will disclose the nature of the amendment or waiver, its effective date and
to whom it applies in a Current Report on Form 8-K filed with the SEC.

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE
ACT

Section 16(a) of the Exchange Act requires our executive
officers and directors, and persons who own more than 10% of a registered class
of our securities (Reporting Persons), to file reports of ownership and
changes in ownership with the SEC. Reporting Persons are required by SEC
regulations to furnish us with copies of all forms they file pursuant to Section
16(a). Based solely on our review of such reports received by the Company, other
than as described below, we believe that, during the year ended June 30, 2011,
all Reporting Persons complied with all Section 16(a) filing requirements
applicable to them.

The following persons have failed to file, on a timely basis,
the identified reports required by Section 16(a) of the Exchange Act:

Name and Principal Position
    Number of Late Insider
      Reports
    Transactions Not Timely
      Reported
    Known Failures to File a
      Required FormAnthony Harvey Director,
      Chairman and Chief Executive Officer
    None
    None
    NoneBenjamin Ainsworth Director, President
      And Secretary
    None
    None
    NoneKurt Bordian Chief
      Financial Officer and Treasurer
    None
    None
    NoneBryan Wilson Director
    None
    None
    NoneJames E. Yates Director
    One
    One
    NoneMilton Datsopoulos Former Director
    None
    None
    None


32

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|ITEM 11. | EXECUTIVE COMPENSATION.
|-------- | -----------------------

SUMMARY COMPENSATION TABLE

The following table sets forth the total compensation paid to
or earned by our named executive officers, as that term is defined in Item
402(m)(2) of Regulation S-K, as of our fiscal years ended June 30, 2011 and
2010:

Name & Principal
      Position
    Year
    Salary
      ($)
    Bonus
      ($)
    Stock Awards
      ($)
    Option
      Awards ($)
    Non- Equity
      Incentive Plan Compen- sation
      ($)
    Non- qualified
      Deferred Compen- sation
      Earnings ($)
    All Other
      Compen- sation ($)
    Total
      ($)Anthony Harvey, Director, Chairman
      and CEO(1)
    2011 2010
    60,497 60,505
    - -
    - -
    - 106,131
    - -
    - -
    - -
    60,497 166,636Kurt Bordian, CFO and Treasurer(2)
    2011 2010
    74,173 69,300
    - -
    - -
    - 44,221 -
    - -
    - -
    - -
    74,173 113,521Benjamin Ainsworth, Director, President
      and Secretary(3)
    2011 2010
    60,497 56,898
    - -
    - -
    - 53,066
    - -
    - -
    - -
    60,497 109,964


|Notes: |                                                                                                                                                                                                                                                                                                                                                                                                                      
|------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1)    | Mr. Harvey was appointed as our CEO, Chairman and as a
      member of our Board of Directors on May 30, 2006. Mr. Harvey is
      compensated for his services pursuant to a management consultant agreement
      dated December 1, 2007 among Canyon Copper, ARH Management Ltd. (ARH)
      and Mr. Harvey. Under the terms of the agreement, ARH is to be paid a
      consulting fee of CDN $5,000 per month.
|(2)    | Mr. Bordian was appointed as our Chief Financial Officer
      on January 6, 2006. Pursuant to the terms of a consultant agreement, we
      pay Mr. Bordian $3,675 per month. We also pay Mr. Bordian an additional
      $3,675 per month for various consulting and bookkeeping services performed
      by Mr. Bordian.                                                                                          
|(3)    | Mr. Ainsworth was appointed as our President on November
      7, 2007. Mr. Ainsworth is compensated for his services pursuant to a
      management consultant agreement dated December 1, 2007 among Canyon
      Copper, Ainsworth-Jenkins Holdings Inc. (AJ Holdings) and Mr. Ainsworth.
      Under the terms of the agreement, AJ Holdings is to be paid a consulting
      fee of CDN $5,000 per month.     

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

The following table provides information concerning unexercised
options for each of our named executive officers, as that term is defined in
Item 402(m)(2) of Regulation S-K, as of our fiscal year ended June 30, 2011:

Name and Principal
      Position
    Number of
      Securities Underlying Unexercised
      Options (#) Exercisable
    Number of
      Securities Underlying Unexercised
      Options (#) Unexercisable
    Equity Incentive Plan
      Awards: Number of Securities
      Underlying Unexercised Unearned
      Options
    Option
      Exercise Price
    Option
      Expiration DateAnthony Harvey Director, Chairman
      and CEO
    948,000 131,667
    - -
    - -
    $0.13 $0.95
    Aug 20, 2014 Dec 2, 2012Kurt Bordian CFO and Treasurer
    395,000 131,667
    - -
    - -
    $0.13 $0.95
    Aug 20, 2014 Dec 2, 2012


33

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Name and Principal
      Position
    Number of
      Securities Underlying Unexercised
      Options (#) Exercisable
    Number of
      Securities Underlying Unexercised
      Options (#) Unexercisable
    Equity Incentive Plan
      Awards: Number of Securities
      Underlying Unexercised Unearned
      Options
    Option
      Exercise Price
    Option
      Expiration DateBenjamin Ainsworth Director, President
      and Secretary
    474,000 131,667
    - -
    - -
    $0.13 $0.95
    Aug 20, 2014 Dec 2, 2012


DIRECTOR COMPENSATION

The following table sets forth the compensation paid to our
directors for the fiscal year ended June 30, 2011.

Name
    Fees Earned or
      Paid in Cash ($)
    Stock Awards
      ($)
    Option Awards
      ($)
    Non-Equity Incentive
      Plan Compen- sation ($)
    Nonqualified Deferred
      Compen- sation Earnings ($)
    All Other Compen-
      sation ($)
    Total ($)Bryan Wilson
    -
    -
    -
    -
    -
    -
    -James E. Yates
    -
    -
    -
    -
    -
    -
    -Milton Datsopoulos(1)
    -
    -
    -
    -
    -
    -
    -


|Note: |                                                                                          
|----- | -----------------------------------------------------------------------------------------
|(1)   | On May 17, 2011, Milton Datsopoulos resigned as
      a member of our Board of Directors.

|ITEM 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
      OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.
|-------- | -----------------------------------------------------------------------------------------------------

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT

The following table sets forth certain information concerning
the number of shares of our common stock owned beneficially as of September 26,
2011 by: (i) each of our directors and nominees, (ii) each of our named
executive officers, and (iii) officers and directors as a group. Other than as
described below, no person or group is known by us to beneficially own more than
5% of our outstanding shares of common stock. Unless otherwise indicated, the
stockholders listed possess sole voting and investment power with respect to the
shares shown.

Title of Class
    Name and Address
      of Beneficial Owner
    Amount and Nature of
      Beneficial Ownership(1)
    Percentage of Common
      Stock(1)Directors and OfficersCommon Stock
    Anthony Harvey Director,
      Chairman and Chief Executive Officer
    3,915,098 shares Direct and
      Indirect(2)
    5.6%Common Stock
    Benjamin
      Ainsworth Director, President and Secretary
    1,143,584 shares
      Direct(3)
    1.7%Common Stock
    Kurt Bordian Chief Financial
      Officer and Treasurer
    847,934 shares
      Direct(4)
    1.2%Common Stock
    Bryan Wilson
      Director
    368,667 shares
      Direct(5)
    *Common Stock
    James Yates Director
    940,000 shares Direct and
      Indirect(6)
    1.4%Common Stock
    All Officers and
      Directors as a Group (5 persons)
    7,215,283 shares
    10.1%


34

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Title of Class
    Name and Address
      of Beneficial Owner
    Amount and Nature of
      Beneficial Ownership(1)
    Percentage of Common
      Stock(1)5% StockholdersCommon Stock
    Anthony Harvey Suite 408,
      1199 West Pender Street Vancouver, BC V6E 2R1
    3,915,098 shares Direct and
      Indirect(2)
    5.6%Common Stock
    Cornucopia
      Holdings Limited Herrengasse 2 PO Box 562 Vaduz, Liechtenstein FL
      9490
    4,187,000 shares Direct
    6.1%Common Stock
    Knightwall Invest Inc. 3076
      Sir Francis Drakes Highway Road Town, Tortola BVI
    4,937,500 shares Direct
    7.2%Common Stock
    Centrum Bank AG
      Kirchstrasse 3 9490 Vaduz Principality of Liechtenstein
    12,744,967 shares Direct
    18.6%


|Notes: |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|*      | Less than 1%.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|(1)    | Applicable percentage of ownership is based on 68,396,934
      shares of common stock outstanding as of September 26, 2011 together with
      securities exercisable or convertible into shares of Common Stock within
      60 days of September 26, 2011 for each stockholder. Beneficial ownership
      is determined in accordance with the rules of the SEC and generally
      includes voting or investment power with respect to securities. Shares of
      common stock subject to securities exercisable or convertible into shares
      of common stock that are currently exercisable or exercisable within 60
      days of September 26, 2011 are deemed to be beneficially owned by the
      person holding such options for the purpose of computing the percentage of
      ownership of such person, but are not treated as outstanding for the
      purpose of computing the percentage ownership of any other person.
|(2)    | The number of shares listed as beneficially owned by Mr.
      Harvey consists of: (i) 1,507,584 shares of common stock owned directly by
      Mr. Harvey; (ii) 857,142 shares held by ARH Management Ltd., a company
      controlled by Mr. Harvey; (iii) 42,134 shares of common stock held by Mr.
      Harveys spouse; (iv) the option to purchase 131,667 shares of common
      stock at a price of $0.95 per share until December 2, 2012; (v) the option
      to purchase 948,000 shares of common stock at a price of $0.13 per share
      until August 20, 2014; and (vi) warrants to purchase 428,571 shares of
      common stock at a price of CDN $0.50 per share until January 8, 2013 by
      ARH Management Ltd.                                                                                                                                                                                                         
|(3)    | The number of shares listed as beneficially owned by Mr.
      Ainsworth consists of: (i) 537,917 shares of common stock owned directly
      by Mr. Ainsworth; (ii) the option to purchase 131,667 shares of common
      stock at a price of $0.95 per share until December 2, 2012; and (iii) the
      option to purchase 474,000 shares of common stock at a price of $0.13 per
      share until August 20, 2014.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|(4)    | The number of shares listed as beneficially owned by Mr.
      Bordian consists of: (i) 321,267 shares of common stock owned directly by
      Mr. Bordian; (ii) the option to purchase 131,667 shares of common stock at
      $0.95 per share until December 2, 2012 and (iii) the option to purchase
      395,000 shares of common stock at $0.13 per share until August 20, 2014.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|(5)    | The number of shares listed as beneficially owned by Mr.
      Wilson consists of: (i) 79,000 shares of common stock held directly by Mr.
      Wilson; (ii) the option to purchase 52,667 shares of common stock at a
      price of $0.95 per share until December 2, 2012; and (iii) the option to
      purchase 237,000 shares of common stock at a price of $0.13 per share
      until August 20, 2014.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|(6)    | The number of shares listed as beneficially owned by Mr.
      Yates consists of: (i) 237,000 shares of common stock owned directly by
      Mr. Yates; (ii) 387,000 shares of common stock held by Mr. Yates spouse;
      and (iii) the option to purchase 316,000 shares of common stock at a price
      of $0.13 per share until August 20, 2014.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         

Change in Control

We are not aware of any arrangement which may result in a
change in control in the future.

EQUITY COMPENSATION PLAN INFORMATION

The following table sets forth certain information concerning
all equity compensation plans previously approved by stockholders and all
previous equity compensation plans not previously approved by stockholders, as
at June 30, 2011.

35

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EQUITY COMPENSATION PLAN INFORMATION AS AT
      JUNE 30, 2011Plan Category
    Number of securities
      to be issued upon exercise of outstanding options, warrants
      and rights (a)
    Weighted-average
      exercise price of outstanding options, warrants and rights
      (b)
    Number of securities
      
      remaining available for future issuance under equity
      compensation plans (excluding securities reflected in column
      (a)) (c)Equity Compensation Plans approved by security holders
    Nil
    N/A
    NilEquity Compensation Plans not approved
      by security holders
    3,548,417
    $0.27 per share
    2,989,150Total
    3,548,417
    $0.27 per share
    2,989,150


Amended and Restated 2009 Stock Option Plan

On May 4, 2011, our Board of Directors adopted an Amended and
Restated 2009 Stock Option Plan (the "Stock Option Plan"). The purpose of the
Stock Option Plan is to assist us in attracting, retaining and motivating
directors, officers, employees and consultants of our company. The Stock Option
Plan provides that, subject to the requirements of the TSX Venture Exchange, the
aggregate number of securities reserved for issuance will be 10% of the number
of our shares of common stock issued and outstanding from time to time. The
Stock Option Plan will be administered by our board of directors, which will
have full and final authority with respect to the granting of all options
thereunder.

Stock Options may be granted under the Stock Option Plan to
such service providers of our company, if any, as the board of directors may
from time to time designate. The exercise price of Stock Option grants will be
determined by the board of directors, but cannot be less than the closing market
price of the shares of our common stock on the TSX Venture Exchange less
allowable discounts at the time of grant. The Stock Option Plan provides that
the number of shares of our common stock that may be reserved for issuance to
any one individual upon exercise of all stock options held by such individual
may not exceed 5% of the issued share of our common stock, if the individual is
a director or officer, or 2% of the issued shares of our common stock, if the
individual is a consultant, on a yearly basis. Subject to earlier termination
and in the event of dismissal for cause, termination other than for cause or in
the event of death, all Stock Options granted under the Stock Option Plan will
expire not later than the date that is five years from the date that such Stock
Options are granted. Stock Options granted under the Stock Option Plan are not
transferable or assignable other than by will or other testamentary instrument
or pursuant to the laws of succession.

|ITEM 13. | CERTAIN RELATIONSHIPS AND
      RELATED TRANSACTIONS, AND DIRECTOR
      INDEPENDENCE.
|-------- | --------------------------------------------------------------------------------------

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

None of the following parties has, during the past two fiscal
years, had any material interest, direct or indirect, in any transaction with us
or in any presently proposed transaction that has or will materially affect us,
other than as noted in this section:

| | (i)   | Any of our directors or executive officers;                                                                                                                                
| | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (ii)  | Any person proposed as a nominee for election as a
      director;                                                                                                         
| | (iii) | Any person who beneficially owns, directly or indirectly,
      shares carrying more than 5% of the voting rights attached to our
      outstanding shares of common stock;
| | (iv)  | Any of our promoters; and                                                                                                                                                  
| | (v)   | Any member of the immediate family (including spouse,
      parents, children, siblings and in-laws) of any of the foregoing
      persons.                                

36

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As at June 30, 2010, we are indebted to Mr. Harvey, our CEO,
Chairman and a member of our Board of Directors, in the principal amount of
$445,066 (CDN$413,209). The indebtedness owed to Mr. Harvey consists of the
following:

|(a) | unpaid consulting fees of $222,983 (CDN$215,000). This
      amount is non-interest bearing, unsecured and due on demand.                                                                                     
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                               
|(b) | loan of $77,784 (CDN $75,000) bearing interest at a rate
      of 15% per annum and due on May 22, 2012. As at June 30, 2011, we have
      accrued interest of $7,033 (CDN $6,780) in respect of this loan.  
|    |                                                                                                                                                                                                               
|(c) | loan of $50,000 bearing interest at a rate of 15% per
      annum and due on April 1, 2012. As at June 30, 2011, we have accrued
      interest of $5,466 in respect of this loan.                            
|    |                                                                                                                                                                                                               
|(d) | loan of $77,784 (CDN $75,000) bearing interest at a rate
      of 15% per annum and due on July 1, 2012. As at June 30, 2011, we have
      accrued interest of $5,179 (CDN $4,993) in respect of this
  loan.

As at June 30, 2010, we are indebted to Mr. Ainsworth, our
President, Secretary and a member of Board of Directors, in the amount of
$222,983 (CDN$215,000) for unpaid consulting fees. This amount is non-interest
bearing, unsecured and due on demand.

DIRECTOR INDEPENDENCE

Our common stock is listed on the TSX Venture Exchange, which
requires us to have a minimum of two independent directors. For the purpose of
determining director independence, we have adopted the independence requirements
of Canadian National Instrument 52-110  Audit Committees (NI 52-110)
as we are a reporting issuer in the provinces of British Columbia and Alberta.
NI 52-110 recommends that the Board of Directors of a public company be
constituted with a majority of individuals who qualify as independent
directors. An independent director is a director who has no direct or indirect
material relationship with us. A material relationship is a relationship which
could, in the view of the Board of Directors, reasonably interfere with the
exercise of a directors independent judgment. James E. Yates and Bryan Wilson
are independent directors, as aside from shares held by them, they have no
ongoing interest or relationship with us other than serving as a director.
Anthony Harvey and Benjamin Ainsworth are not independent directors because of
their respective positions as CEO and President.

CANADIAN NATIONAL INSTRUMENT 58-101

We are a reporting issuer in the Provinces of British Columbia
and Alberta. National Instrument 58-101 of the Canadian Securities
Administrators requires our company to disclose annually on our Annual Report
certain information concerning corporate governance.

Board of Directors

The Board of Directors is currently comprised of four members.
Anthony Harvey and Benjamin Ainsworth are not independent directors because of
their respective positions as CEO and President. James E. Yates and Bryan Wilson
are independent directors, as aside from shares held by them, they have no
ongoing interest or relationship with us other than serving as a director. See
Item 13  Certain Relationships and Related Transactions, and Director
Independence  Director Independence.

37

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Directorships

The following members of our Board of Directors are
directors/officers of other reporting issuers:

|Name of
      Director | Name of Reporting Issuer               | Exchange
|---------------------- | -------------------------------------- | --------
|Anthony Harvey         | ESO Uranium Corp.                      | TSXV    
|Benjamin Ainsworth     | Black Panther Mining Corp.             | TSXV    
|                       | Columbia Yukon Explorations
      Inc. | TSXV    
|                       | ESO Uranium Corp.                      | TSXV    
|                       | Hathor Exploration Ltd.                | TSXV    
|                       | Max Minerals Ltd.                      | TSXV    
|                       | Sultan Minerals Inc.                   | TSXV    
|Kurt Bordian           | Calypso Uranium Corp.                  | TSXV    
|                       | Palo Duro Energy Inc.                  | TSXV    
|                       | ESO Uranium Corp.                      | TSXV    
|                       | Thor Explorations Ltd.                 | TSXV    
|                       | Black Tusk Minerals Inc.               | OTCBB   
|Bryan Wilson           | Spider Resources Inc.                  | TSXV    
|                       | Doubleview Capital Corp.               | TSXV    
|James E. Yates         | Nevada Geothermal Power Inc.           | TSXV    
|                       | ESO Uranium Corp.                      | TSXV    

Orientation and Continuing Education

The Board of Directors provides an overview of our business
activities, systems and business plan to all new directors. New director
candidates have free access to any of our records, employees or senior
management in order to conduct their own due diligence and will be briefed on
our strategic plans, short, medium and long term corporate objectives, business
risks and mitigation strategies, corporate governance guidelines and existing
policies. The directors are encouraged to update their skills and knowledge by
taking courses and attending professional seminars.

Ethical Business Conduct

The Board of Directors believes good corporate governance is an
integral component to our success and to meet their responsibilities to
shareholders. Generally, the Board of Directors has found that the fiduciary
duties placed on individual directors by our governing corporate legislation and
the common law and the restrictions placed by applicable corporate legislation
on an individual directors participation in decisions of the Board of Directors
in which the director has an interest have been sufficient to ensure that the
Board of Directors operates independently of management and in our best
interest.

The Board of Directors is also responsible for applying
governance principles and practices, and tracking development in corporate
governance, and adapting best practices to suit the needs of the Company.
Certain directors may also be directors and officers of other companies, and
conflicts of interest may arise between their duties. Such conflicts must be
disclosed in accordance with, and are subject to such other procedures and
remedies as applicable under Chapter 78 of the Nevada Revised Statutes.

Nomination of Directors

The Board of Directors has not formed a nominating committee or
similar committee to assist it with the nomination of directors. The Board of
Directors considers itself too small to warrant creation of such a committee;
and each of the directors has contacts he can draw upon to identify new members
of the Board of Directors as needed from time to time.

The Board of Directors will continually assess its size,
structure and composition, taking into consideration its current strengths,
skills and experience, proposed retirements and the requirements and strategic
direction of the Company. As required, directors will recommend suitable
candidates for consideration as members of the Board of Directors.

38

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Compensation

The Board of Directors reviews the compensation of directors
annually.

Other Board Committees

We have established a disclosure committee. The disclosure
committee is comprised of all of our officers and directors. The purpose of the
disclosure committee is to provide assistance to the Chief Executive Officer and
Chief Financial Officer in fulfilling their responsibilities regarding the
identification and disclosure of material information about us and the accuracy,
completeness and timeliness of our financial reports.

Other than the audit committee and the disclosure committee, we
do not have any other committees.

Assessments

The Board of Directors has not implemented a process for
assessing its effectiveness. As a result of our small size and stage of
development, the Board of Directors considers a formal assessment process to be
inappropriate at this time. The Board of Directors plans to continue evaluating
its own effectiveness on an ad hoc basis.

The Board of Directors does not formally assess the performance
or contribution of individual Board members or committee members.

|ITEM 14. | PRINCIPAL ACCOUNTING FEES AND SERVICES.
|-------- | ---------------------------------------

Audit Fees

The aggregate fees billed for the two most recently completed
fiscal years ended June 30, 2011 and June 30, 2010 for professional services
rendered by the principal accountant for the audit of our annual financial
statements and review of the financial statements included our Quarterly Reports
on Form 10-Q and services that are normally provided by the accountant in
connection with statutory and regulatory filings or engagements for these fiscal
periods were as follows:

Year Ended June 30, 2011
    Year Ended June 30, 2010(Saturna Group)
    (Saturna Group)
    (Manning Elliott LLP)Audit Fees
    $19,021
    $10,418
    $7,577Audit Related Fees
    -
    -
    -Tax Fees
    -
    -
    -All Other Fees
    -
    -
    -Total
    $19,021
    $10,418
    $7,577


Policy on Pre-Approval by Audit Committee of Services
Performed by Independent Auditors

The policy of our Audit Committee is to pre-approve all audit
and permissible non-audit services to be performed by our independent auditors
during the fiscal year. Non-audit services that are prohibited to be provided by
our independent auditors may not be pre-approved. In addition, prior to the
granting of any pre-approval, our Audit Committee must be satisfied that the
performance of the services in question will not compromise the independence of
the independent auditors.

39

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No services related to Audit-Related Fees, Tax
Fees or All Other Fees described above were approved by the Audit
Committee pursuant to the waiver of pre-approval provisions set forth in the
applicable rules of the SEC.

|ITEM 15. | EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
|-------- | ----------------------------------------

|Exhibit |                                                                                                                                                                                        
|------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Number  | Description of Exhibit                                                                                                                                                                 
|3.1     | Amended and Restated Articles
      of Incorporation.(6)                                                                                                                               
|3.2     | Certificate of Change Pursuant to NRS 78.209
      decreasing the authorized capital of common stock to 166,666,666 shares,
      par value $0.00001 per share.(8)                     
|3.3     | Certificate of Change Pursuant
      to NRS 78.209 decreasing the authorized capital of common stock to
      131,666,666 shares, par value $0.00001 per share.(11)                    
|3.4     | Amended and Restated Bylaws.(14)                                                                                                                                                       
|4.1     | Specimen Stock
      Certificate.(15)                                                                                                                                                  
|10.1    | Convertible Preferred Stock Purchase Agreement
      dated July 29, 2004 between the Company and Langley Park Investments
      PLC.(3)                                                
|10.2    | Property Option Agreement dated
      March 18, 2004 among the Company, Robert & Sharon Weicker, Kurt &
      Tami Schendel, and Nevada Sunrise LLC (New York Canyon
      Project).(2)
|10.3    | Lease Agreement dated July 21, 2004 between the
      Company and Jaycor Mining, Inc.(4)                                                                                               
|10.4    | Consulting Agreement dated
      January 6, 2006 between the Company and Kurt Bordian.(5)                                                                                              
|10.5    | Quitclaim Deed for the New York Canyon Project
      dated March 12, 2007.(7)                                                                                                          
|10.6    | Purchase and Sale Agreement
      dated August 5, 2010 between Canyon Copper Corp. and ESO Uranium
      Corp.(9)                                                                      
|10.7    | Loan Agreement dated for reference October 7,
      2010 between Canyon Copper Corp. and Anthony Harvey.(10)                                                                           
|10.8    | Promissory Note dated for
      reference October 7, 2010 between Canyon Copper Corp. and Anthony Harvey
      for the loan of $50,000 (USD).(10)                                      
|10.9    | Loan Agreement dated November 22, 2010 between
      Canyon Copper Corp. and Anthony Harvey.(11)                                                                                       
|10.10   | Promissory Note dated November
      22, 2010 between Canyon Copper Corp. and Anthony Harvey for the loan of
      $75,000 (CDN).(11)                                                  
|10.11   | Loan Agreement dated January 19, 2011 between
      Canyon Copper Corp. and Anthony Harvey.(12)                                                                                        
|10.12   | Promissory Note dated January
      19, 2011 between Canyon Copper Corp. and Anthony Harvey for the loan of
      $75,000 (CDN).(12)                                                   
|10.13   | Engagement letter dated January 26, 2011
      between MGI Securities Inc. and Canyon Copper Corp.(13)                                                                                 
|10.14   | Sponsorship Engagement Letter
      dated January 26, 2011 between MGI Securities Inc. and Canyon Copper
      Corp.(13)                                                               
|10.15   | Amended and Restated 2009 Stock Option
      Plan.(14)                                                                                                                                 
|10.16   | Agency Agreement dated May 26,
  2011 between MGI Securities Inc. and Canyon Copper Corp.(15)                                                                                          
|14.1    | Code of Ethics.(1)                                                                                                                                                                     
|31.1    | Certification
        of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
    Act of 2002.                                                                    
|31.2    | Certification
        of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
    Act of 2002.                                                                    
|32.1    | Certification
        of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as
    adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                     
|32.2    | Certification
        of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as
    adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                     
|99.1    | Audit Committee
      Charter.(1)                                                                                                                                                      
|99.2    | Disclosure Committee Charter.(1)                                                                                                                                                       

|Notes: |                                                                                                          
|------ | ---------------------------------------------------------------------------------------------------------
|(1)    | Filed with the SEC as an exhibit to our Annual
      Report on Form 10-KSB filed on August 26, 2003.     
|(2)    | Filed with the SEC as an exhibit to our Current
      Report on Form 8-K filed on April 8, 2004.         
|(3)    | Filed with the SEC as an exhibit to our Current
      Report on Form 8-K filed on August 20, 2004.       
|(4)    | Filed with the SEC as an exhibit to our Annual
      Report on Form 10-KSB filed on October 8, 2004.     
|(5)    | Filed with the SEC as an exhibit to our
      Quarterly Report on Form 10-QSB filed on February 16, 2006.
|(6)    | Filed with the SEC as an exhibit to our Annual
      Report on Form 10-KSB filed on October 13, 2006.    

40

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|(7)  | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on March 26, 2007.         
|---- | ----------------------------------------------------------------------------------------------------------
|(8)  | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on May 19, 2009.           
|(9)  | Filed with the SEC as an exhibit to our Annual Report on
      Form 10-K filed on September 28, 2010.     
|(10) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on October 13, 2010.       
|(11) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on November 29, 2010.      
|(12) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on January 21, 2011.       
|(13) | Filed with the SEC as an exhibit to our Current Report on
      Form 8-K filed on January 31, 2011.       
|(14) | Filed with the SEC as an exhibit to our Quarterly Report
      on Form 10-Q filed on May 9, 2011.         
|(15) | Filed with the SEC as an exhibit to our Registration
      Statement on Form S-1 filed on August 15, 2011.

41

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.

| |     | **CANYON COPPER
    CORP.**         
| | --- | ------------------------------------
| |     |                                     
| |     |                                     
| | By: | /s/
      Anthony Harvey            
| |     | ANTHONY HARVEY                      
| |     | Chairman and Chief Executive Officer
| |     | Director                            
| |     | (Principal Executive Officer)       
| |     | Date: September 27, 2011            
| |     |                                     
| |     |                                     
| |     |                                     
| | By: | /s/
      Kurt Bordian              
| |     | KURT BORDIAN                        
| |     | Chief Financial Officer             
| |     | (Principal Financial Officer)       
| |     | Date: September 27, 2011            

Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the dates indicated.

|Signature                    |  | Title                                 |  |  | Date               | 
|---------------------------- |  | ------------------------------------- |  |  | ------------------ | 
|                             |  | Chairman, Chief Executive Officer and |  |  |                    | 
|/s/ Anthony
      Harvey     |  | Director                              |  |  | September 27, 2011 | 
|ANTHONY HARVEY               |  | (Principal Executive Officer)         |  |  |                    | 
|                             |  |                                       |  |  |                    | 
|                             |  |                                       |  |  |                    | 
|/s/ Benjamin
      Ainsworth |  | President, Treasurer and Director     |  |  | September 27, 2011 | 
|BENJAMIN AINSWORTH           |  |                                       |  |  |                    | 
|                             |  |                                       |  |  |                    | 
|                             |  |                                       |  |  |                    | 
|/s/ Kurt
      Bordian       |  | Chief Financial Officer               |  |  | September 27, 2011 | 
|KURT BORDIAN                 |  | (Principal Financial Officer)         |  |  |                    | 
|                             |  |                                       |  |  |                    | 
|                             |  |                                       |  |  |                    | 
|/s/ James
      Yates        |  |                                       |  |  | September 27, 2011 | 
|JAMES YATES                  |  | Director                              |  |  |                    | 

---